Sources of Resourcefulness: Evidence that the Culture of Poverty Is a Productive Adaptation to Economic Uncertainty

Abstract

Low-income communities in industrialized societies share common characteristics such as unmarried cohabitation and female-headed households. The unresolved question about these unstable family structures is whether they are a cause or effect of poverty. This mystery is the axis continuously turning the policy debate over welfare programs, with arguments about government assistance easing the economic stresses that threaten family stability and counterarguments about benefits targeting unstable families undermining the stabilizing institution of marriage. This thesis seeks to resolve this debate by offering a third way: unstable family structures are not a detriment for low-income households but are, instead, a source of flexibility and resourcefulness. Evidence presented below indicates that non-traditional family structures such as unmarried cohabitation and female-headed households are associated with greater wealth for households below the federal poverty line (which is why these patterns persist) but are associated with less wealth for other Americans (which is why these patterns are decried in the mainstream). Because this improvement in resourcefulness below the poverty line is likely linked to networks of mutual obligation, which could prevent individuals from escaping poverty, I also use panel data to test whether these same indicators are associated with a decreased likelihood of exiting poverty. This research therefore finds quantitative evidence for qualitative descriptions of life in poverty and, in doing so, offers unique evidence explaining the behaviors of people living below the federal poverty line.