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This paper examines why Canadian poverty rates fell relative to U. S. poverty rates during the periods 1970-1979 and 1979-1986. During the 1970s the principal reason for declining Canadian poverty rates is higher economic growth. During the 1980s, however, differences in government transfer policy are the main cause of relative poverty change in the two countries. Virtually all of the 3.3 point fall in relative Canadian/U.S. poverty rates from 1979 to 1986 can be attributed to expansions in the Canadian transfer system and simultaneous contractions in U. S. transfers. [ABSTRACT FROM AUTHOR]

The article studies the relationship between economic growth and the extent of poverty among American families in order to find ways to reduce the poverty. The income distribution stretches as average income grows; if this were not true, poverty would long since have ceased to be a problem. In colonial times, the income gap between the very poor and all but the very rich must have been at most a few hundred dollars. Since the median income in the U.S. now is well above any upper bound of poverty, if the dispersion of income had remained constant as its central tendency grew, no one would now be poor. But the dispersion of income expands along with its central tendency. The quintile boundaries of the income distribution rise approximately by the same percentages, thus bringing widening absolute differentials. This accords with our retributive standards of justice; people are rewarded in proportion to their relative degrees of social worth or productivity. It incidentally guarantees the persistence of poverty without public policies designed to redistribute income or earning power.

The article presents an analysis of neighborhood change in Cleveland, Ohio in the 1980s using two-wave panel design and causal modeling. Studies have shown that poverty predicts rates of births to unmarried mothers, juvenile delinquency, crime and drug-related problems in urban neighborhoods. Economic deprivation theory postulates that high rates of juvenile delinquency, crime and drug-related problems are associated with poor neighborhoods and suggests that a rise in poverty increases a sense of economic injustice, which results in higher rates of violence. In this article authors study interrelationships among neighborhoods' poverty levels and types of social conditions described in the urban poverty literature by examining factors related to neighborhood poverty in Cleveland at the beginning and end of the 1980s. It demonstrates the usefulness of panel analysis using LISREL (Linear Structural Relations) version 7.2. It reports that the Cleveland economy grew steadily throughout the 1950s, 1960s and much of the 1970s, with the emphasis on manufacturing enterprises. In the early 1980s both Cleveland and its suburbs lost a large number of manufacturing jobs either permanently or to the furthest suburbs. In the city of Cleveland 90,000 manufacturing jobs were lost between 1979 and 1983. Along with jobs loss, Cleveland lost population and investment in new housing mostly to its suburban areas.