Extreme Poverty on the Decline

Charles Kenny from the Center for Global Development and the New America Foundation uses his weekly article in Foreign Policy magazine to point out that despite the persistance of crushing poverty, particularly in Africa, lives are getting better -- even for the poorest of the poor. For almost all of human history, most people everywhere lived on the brink of survival. About 200 years ago, things began to change for people in wealthy countries, mostly in North American and Europe, while living standards improved much more slowly in Africa and Asia. As late as 1981, half the world's population still lived on less than $1.25 per day. But in the last twenty years, growth has taken off in the world's poorest countries. GDP growth per capita has averaged 4.4% a year in the past decade in poor countries even as growth has been anemic in rich countries. For the first time since the industrial revolution, inequality between countries in decreasing (conversely long decreasing inequality within countries is increasing). This growth in poor countries has lead to a corresponding decrease in poverty. Researchers suggest that less than 15% of the people in the world now subsist on less than a $1.25 a day. China and India have, of course, been on the forefront of global growth. As a result, extreme poverty is now most heavily concentrated in Africa, where Brookings scholars suggest 60% of the world's poor people will live by 2015 (as recently as 2005, 66% lived in the much more populous continent of Asia). Yet, even in the long written-off continent progress is being made, albiet more slowly and more recently. Poverty is down 30% since 1995 and on pace to be halved over the period from 1990 to 2017 according to one study

Kenny acknowledges that the data he uses to support his argument are tenuous. Cross-national comparisons of wealth are difficult due to different price levels, and many underdeveloped countries cannot report accurate statistics for recent years. Furthermore, Kenny thrice cites single studies as definitive estimates (for a look at his estimate of halving African poverty over 27 years see this discussion from the World Bank). Still there is little doubt that his broader narrative is correct. More people live better now than ever before.
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