An assessment of poverty determinants in U.S. census tracts, 1970–2010

This paper deals with the determinants of poverty in the U.S. at the census tract level. By proceeding in this way, potential aggregation errors that may occur when using larger areas as the unit of observation are avoided. Our empirical analysis exploits a geographically consistent data set covering the period 1970–2010 and all metropolitan statistical areas. The estimations have been carried out using a system generalized method of moments framework for dynamic panels. Our results show that poverty is a persistent phenomenon, especially in tracts with higher levels. Those variables with a more robust relationship with poverty reflect labor market conditions. We also obtain evidence of a higher vulnerability of women to poverty. These findings have been framed within the debate about the optimal design of local development strategies. The main conclusion drawn is that place‐based and person‐centered policies can be considered as complementary rather than as substitutes.