Econintersect: A new study by the Pew Research Center finds that the 21st century is seeing significant reduction in poverty in many parts of the globe. However, the shift of large numbers of people from poverty into low income has not been accompanied by a similar movement from low income to middle income. Africa is lagging in moving people from poverty to low income as the share of global poor living on the dark continent has risen from 20% in 2001 to 34% in 2011.
A good example of the failure to expand the middle income demographic is the world’s second most populous country, India. The country has moved nearly a quarter of a million people out of poverty in the 21st century – but only about a tenth of that number have been added to the middle class.
There are 26 countries which have had a 15% or larger decrease in the populatiion of the poor since 2001. Half of those countries (13) have had an increase in the middle class and above of 2% or less. Another 4 have an increase in population above low income of only 3% or 4%.
But the story is not all bad. six countries have broken the pattern here and increased middle income and higher populations more than low income: Bhutan, Moldova, China, Ecuador, Kazakhstan and Argentina. Of these six countries four have reduced poverty to zero or near zero, while Ecuador has reduced it to 7% and China to 12%. For reference, the U.S. has only 2% of the population living in poverty by the definitions in this study, while the official reported number by the U.S. Census Bureau for their definition was around 15% for 2012.
Click on the page image below to read the entire report from the Pew Research Center.