The Economic Security Index: A New Measure for Research and Policy Analysis

56 Pages Posted: 27 Oct 2012

See all articles by Jacob S. Hacker

Jacob S. Hacker

Yale University - Department of Political Science; Yale University - Institution for Social and Policy Studies

Gregory Huber

Yale University - Department of Political Science

Austin Nichols

The Urban Institute

Philipp Rehm

Ohio State University (OSU) - Department of Political Science

Mark Schlesinger

Yale University - School of Medicine

Robert G. Valletta

Federal Reserve Bank of San Francisco; IZA Institute of Labor Economics

Stuart Craig

Yale University

Multiple version iconThere are 2 versions of this paper

Date Written: October 27, 2012

Abstract

This paper presents the Economic Security Index (ESI), a new, more comprehensive measure of economic insecurity. By combining data from multiple surveys, we create an integrated measure of volatility in available household resources, accounting for fluctuations in income and out-of-pocket medical expenses, as well as financial wealth sufficient to buffer against these shocks. We find that insecurity has risen steadily since the mid-1980s for virtually all subgroups of Americans, albeit with cyclical ups and downs. We also find, however, that there is substantial disparity in the degree to which different groups are exposed to economic risk. As the ESI derives from a data-independent conceptual foundation, it can be measured using different data sources. We find that the degree and disparity by which insecurity has risen is robust across these sources.

Keywords: household income, volatility, wealth, medical spending

JEL Classification: I14, D31, J11

Suggested Citation

Hacker, Jacob S. and Huber, Gregory and Nichols, Austin and Rehm, Philipp and Schlesinger, Mark and Valletta, Robert G. and Craig, Stuart, The Economic Security Index: A New Measure for Research and Policy Analysis (October 27, 2012). IZA Discussion Paper No. 6946. Available at SSRN: https://ssrn.com/abstract=2167568

Jacob S. Hacker (Contact Author)

Yale University - Department of Political Science ( email )

Box 208269
New Haven, DC 06520-8269
United States

HOME PAGE: http://pantheon.yale.edu/~jhacker

Yale University - Institution for Social and Policy Studies ( email )

89 Trumbull Street
New Haven, CT 06515
United States

Gregory Huber

Yale University - Department of Political Science ( email )

Box 208269
New Haven, DC 06520-8269
United States

Austin Nichols

The Urban Institute ( email )

2100 M Street, NW
Washington, DC 20037
United States

Philipp Rehm

Ohio State University (OSU) - Department of Political Science ( email )

Columbus, OH 43210
United States

Mark Schlesinger

Yale University - School of Medicine ( email )

Department of Epidemiology and Public Health
60 College Street, P.O. Box 208034
New Haven, CT 06520-8034
United States
203-785-4619 (Phone)
203-785-6287 (Fax)

Robert G. Valletta

Federal Reserve Bank of San Francisco ( email )

101 Market Street
San Francisco, CA 94105
United States
415-974-3345 (Phone)
415-977-4084 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Stuart Craig

Yale University

New Haven, CT 06520
United States

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