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Poverty, Cash and In-kind Transfer Programs

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What is poverty?
How does the United States define who is poor?
What is the current poverty rate?
What are cash transfer programs and in-kind transfers?
What role has welfare played in poverty reform?

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https://brainmass.com/economics/economic-development/poverty-cash-kind-transfer-programs-567301

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What is poverty?

Poverty is a state of being. Most people think about the extreme lack of money when poverty is mentioned. Poverty is a form of scarcity, thus poverty is also the lack of shelter, food, clothing, and medical care (Poverty definition, 2013). There is no one cause or cure when it comes to the resolution of poverty.

How does the United States define who is poor?

The US uses the Census Bureau to conduct its assessment and measurement of poverty. This is done using sources of income and family size. The income used is typical salaries or hourly wages, unemployment, social security, and Welfare incomes; this does not include noncash subsidies such as food stamps.

The poverty threshold is the size of the family and the ages of the family size. This excludes situation where there are people living together that are non-relatives or roommates. So if you have to college friend or a best mate that are sharing a living dwelling (such as an apartment or house or cardboard box under the interstate off/on ramp), each person would be classified as their own family even though they live in the same dwelling.
An example of this break down would be as followed:

Household Size Federal Poverty Threshold
1 person $ 9,310
2 people 12,490
3 people 15,670
4 people ...

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The poverty rate and the effects of in-kind transfers.

The poverty rate would be substantially lower if the market value of in-kind transfers were added family income. The largest in-kind transfer is Medicaid, the government health program for the poor. Let's say the program costs $7,000 per recipient family.
a. If the government gave each recipient family a $7,000 check instead of enrolling them in the Medicaid program, do you think that most of these families would spend that money to purchase health insurance? Why? (Recall that the poverty level for a family of four is about $20,000.)
b. How does your answer to part (a) affect you view about whether we should determine the poverty rate by valuing in-kind transfers at the price the government pays for them? Explain.
c. How does your answer to part (a) affect your view about whether we should provide assistance to the poor in the form of cash transfers or in-kind transfers? Explain.

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