Rags or Riches? Estimating the Probabilities of
Poverty and Affluence across the Adult
American Life Span
*
Mark R. Rank, Washington University
Thomas A. Hirschl, Cornell University
Objective. Poverty and affluence represent events central to the American identity
of failure and success. Yet in spite of their significance, we know little about the
actual likelihood of experiencing these events across the adult life course. In this
article we empirically estimate the extent to which Americans will experience pov-
erty and/or affluence during their adulthood. Methods. A series of life tables are
constructed based upon data from 25 waves of the Panel Study of Income Dynam-
ics. Our measure of poverty is identical to that used by the U.S. Census Bureau in
estimating the overall U.S. poverty rates. Affluence is defined as 10 times the pov-
erty level. Results. Results indicate that between the ages of 25 and 75, 51.1 percent
of Americans will experience at least one year below the poverty line, 51.0 percent
will encounter a year of affluence, while only 20.1 percent of Americans will avoid
either of these economic extremes. The effects of race and education in altering the
likelihood of encountering poverty versus affluence are substantial. Conclusions. The
opportunities for acute economic failure and success appear to be very real compo-
nents of the American experience. Based upon this, we discuss an alternative typol-
ogy to conceptualizing stratification in America.
Individual success and failure in American society have often been meas-
ured in monetary terms. Social commentators from Benjamin Franklin to
modern-day pundits have reiterated the importance that Americans have
ascribed to economic success. Alexis de Tocqueville wrote in his treatise
Democracy in America, “The love of wealth is therefore to be traced, as either
a principal or accessory motive, at the bottom of all that the Americans do”
([1840]1994:229). More recently, Andrew Hacker notes that “in the end,
*Direct all correspondence to Mark R. Rank, George Warren Brown School of Social
Work, Washington University, St. Louis, MO 63130 <markr@gwbmail.wustl.edu>. For pur-
poses of replication the Panel Study of Income Dynamics data set is available from the Inter-
University Consortium for Political and Social Research. Coding information is available
from the second author. The authors would like to thank Paul Allison, Avery Guest, Krish-
nan Namboodiri, Bruce Turnbull, several anonymous reviewers, and the editor and manag-
ing editor for their helpful comments.
SOCIAL SCIENCE QUARTERLY, Volume 82, Number 4, December 2001
©2001 by the Southwestern Social Science Association