We propose a new measure of the rate of poverty we call the Supplemental Expenditure Poverty Measure (SEPM) based on expenditure in the Consumer Expenditure survey. It treats household expenditure as a measure of resources available to purchase the minimum bundle necessary to meet basic needs....

Most poverty calculations use income-based or consumption-based measures. We introduce a new, third measure of poverty status which is based on household expenditure. Expenditure is the theoretically correct measure of resources actually transferred into a given period in the life cycle. But the...