"Does the EITC reduce the poverty rate?" Greg Mankiw

From Greg Mankiw's Blog: Does the EITC reduce the poverty rate?

Of course, this is not really a problem with the EITC but, rather, a problem with the measured poverty rate. It makes no sense to evaluate poverty with a statistic that ignores the effects of one of the largest and most rapidly growing anti-poverty tools we have. But that is what the official statistics do.

The EITC is one reason why many low-income families consume more than they earn (a fact pointed out in the previous post). Government policymakers need to take a long, hard look at how poverty is measured. Meanwhile, journalists need to report the official statistics with a healthy dose of caveats.