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Assessing Asset Data on Low-Income Households:

Current Availability and Options for Improvement

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Document date: October 10, 2007
Released online: October 15, 2007

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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Abstract

This report identifies the most reliable and informative data sources for understanding low-income households’ assets and liabilities, details their limitations, and provides options for improving asset data sources and collection methods. The report evaluates 12 data sets and identifies three as having the greatest potential for future asset research—the Survey of Consumer Finances (SCF), the Survey of Income and Program Participation (SIPP), and the Panel Study of Income Dynamics (PSID).


Introduction

The lack of quality data has been a long-standing concern among researchers in studying assets. Except for the 1962 Survey of Financial Characteristics of Consumers, no serious efforts were made to collect reliable asset data before the 1980s. In 1983, the Survey of Consumer Finances (SCF) and the Survey of Income and Program Participation (SIPP) were the first to ask respondents detailed questions about asset holdings. Another major data set, the Panel Study of Income Dynamics (PSID) added a wealth supplement in 1984 (Spilerman 2000). The availability of data on assets stimulated asset research and increased interest in asset-building policies as an anti-poverty strategy and in studying the widening economic gaps since the 1980s (Sherraden 2001; Spilerman 2000). With available data, researchers started to examine the distribution of assets, test theoretical models and hypotheses, and develop new concepts and theories on assets.

To guide future research in assets, this report addresses the following questions:

  • What are the most informative and reliable data sources for understanding low-income households’ assets and liabilities?
  • What are the limitations of these data sources?
  • What are the means for improving asset data?

We identify 12 data sets that have the potential to provide valuable information in studying the assets of low-income households. We evaluate these data sets with four criteria: relevancy, representativeness, recurrence, and richness of correlates. Although we pay special attention to each data set’s ability to provide information on assets (relevancy) among the low-income population (representativeness) over time (recurrence), we also consider the correlates data sets provide (richness of correlates) and thus their ability to answer other important research questions, such as the effects of assets on outcomes. Based on these four criteria, we conclude that three data sets have the greatest potential for future asset research: the Survey of Consumer Finances (SCF), the Survey of Income and Program Participation (SIPP), and the Panel Study of Income Dynamics (PSID).

 

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Topics/Tags: | Children and Youth | Poverty, Assets and Safety Net


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