March 27, 2012
By Molly Dahl, Thomas DeLeire, and Shannon Mok
This paper explores how the use of imputed earnings data to measure income in the Survey of Income and Program Participation affects the observed relationship between household income volatility and food insufficiency. The study finds that the inclusion of imputed earnings data when measuring income volatility substantially understates the association between large drops in household income and food insufficiency. After excluding observations with imputed earnings, large drops in income are associated with a 1.3 percentage point increase in the probability of food insufficiency, although the estimate is not statistically significant at conventional levels.