Impact of Household Income on Poverty Levels

Abstract

The relationship between poverty and household income is an important political topic concerning a country's economy. This study tests the commonly held theory that poverty and household income are negatively correlated. This analysis uses county-level data in the United States in 2013. The simple regression model looks at median household income's effect on total poverty in each county. Then, we added the independent variables: total unemployment, population, and total number of people with less than a high school education. After finding that poverty and household income appeared to be positively correlated, even with these control variables, we then added two dummy variable to test if there was a significant difference in our finding between urban, suburban, and rural counties.