County Characteristics and Poverty Spell Length

Abstract

In this paper we ask, how do individual and community factors influence the average length of poverty spells? We measure local economic conditions by the county unemployment rate and neighborhood spillover effects by the racial makeup and poverty rate of the county. We find that moving an individual from one standard deviation below the mean poverty rate to one standard deviation above the mean poverty rate (from the inner city to the suburbs) lowers the average poverty spell by 20 to 25 percent. This effect is equal in magnitude to the effect of changing the household head from female to male. Also, we find that when we control for the demographic, human capital, and county level effects the conditional effect for high school graduates is only 2 months (85 percent smaller than the unconditional effect), black poverty spells are 7.8 months (half of the unconditional effect), and female headed households increase length of spells by 7.7 months (only 20 percent shorter than the unconditional effect).

JEL Classification: I32