The Under-Reporting of Transfers in Household Surveys: Its Nature and Consequences
High rates of understatement are found for many government transfer programs and in many datasets. This understatement has major implications for our understanding of economic well-being and the effects of transfer programs. We provide estimates of the extent of under-reporting for ten transfer programs in five major nationally representative surveys by comparing reported weighted totals for these programs with totals obtained from government agencies. We also examine imputation procedures and rates. We find increasing under-reporting and imputation over time and sharp differences across programs and surveys. We explore reasons for under-reporting and how under-reporting biases existing studies and suggest corrections.
This research was supported in part by the U.S. Social Security Administration through grant #10-M-98363 -1-01 to the National Bureau of Economic Research as part of the SSA Retirement Research Consortium and by the Economic Research Service of the USDA through Cooperative Research Agreement 58-5000- 6-0106. The findings and conclusions expressed are solely those of the authors and do not represent the views of the SSA, the ERS or any agency of the Federal Government, or the NBER. We thank participants at the Princeton Data Improvement Initiative Conference, the American Economic Association Annual Meetings, the Washington Statistical Society, seminars at the Economic Research Service, the Institute for Social Research and the University of Chicago for their comments, and Stephen Issacson, Karen Peko and the staff at the Food and Nutrition Service, Kevin Stapleton at the Department of Labor, and Steve Heeringa at the PSID Statistical Design Group for help with data. We also thank Richard Bavier, Charles Pierret, Kalman Rupp, Robert Schoeni, and Frank Stafford for their helpful suggestions. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research.