Full Citation
Title: How Additional Cash Payments Would Reduce Poverty
Citation Type: Miscellaneous
Publication Year: 2021
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Abstract: A recent Urban Institute analysis projected that four major policies in the American Rescue Plan (ARP) will reduce the number of people in poverty in 2021 from 44 million to 28 million, shrinking the overall poverty rate from 13.7 percent to 8.7 percent (Wheaton et al. 2021). 1 Of the 16.4 million people lifted out of poverty by four policies in the ARP, the recovery rebates ($1,400 payments to most people) alone would keep 11.4 million people out poverty. 2 With no clear end to the economic hardship caused by the pandemic, some senators have begun calling for additional payments. 3 These could further reduce poverty for millions. Depending on whether additional $1,400 payments are extended to all people in the US or only to citizens, we project that another payment could further reduce 2021 poverty to between 6.4 and 6.6 percent. Two such payments could reduce poverty to between 4.9 and 5.2 percent. Among Black people, an additional payment could reduce poverty from 10.5 percent to between 7.7 and 7.8 percent, and a second payment could further reduce poverty to between 5.8 and 6.0 percent. Hispanic people could see poverty drop from 13.3 percent to between 9.0 and 9.9 percent with one additional payment and to between 6.3 and 7.6 percent with two additional payments.
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Authors: Maag, Elaine; Werner, Kevin
Publisher: Income and Benefits Policy Center
Data Collections: IPUMS USA
Topics: Poverty and Welfare
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