The Current Population Survey Annual Social and Economic Supplement (CPS ASEC) serves as the data source for official income and poverty statistics in the United States. There is a concern that the rise in non-response to earnings questions could deteriorate data quality and distort estimates of income and poverty. The CPS ASEC relies on a hot deck imputation procedure to address non-response. This paper assesses the extent of the bias in poverty rates caused by earnings non-response and the hot deck procedure. We use a dataset of matched CPS ASEC records to Social Security Detailed Earnings Records (DER) to study the impact of earnings non-response on estimates of poverty over the time period 1997-2008. Initial results show substituting DER earnings data for earnings imputed in the CPS ASEC produces poverty rates that are higher than the official poverty rate but not as high as poverty rates produced from completely dropping imputed earners.

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Income & Poverty Working Papers

Page Last Revised - October 8, 2021

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