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21 things they never tell you about poor countries

February 24, 2014

Prompted by Bill Gates’s annual letter and the response from the Overseas Development Institute I thought I’d list some of the things that in my experience seem to be less understood about poor countries. (I wanted to list 23 things like Ha-Joon Chang on capitalism but I couldn’t think of another two). I use the word poor on purpose because although the word risks sounding patronising or dismissive, euphemisms like developing and less-developed can be worse. Thoughts are welcome.

1. Poverty is the rule, not the exception. For most people life just isn’t as good as it is for you and I, the comfortable people from a country rich enough to allow us the literacy, time and Internet access to read blogs written by well-meaning left liberals. Poverty-as-rule-not -exception is difficult to bend our minds around because we tend to base our views about the world on direct experience. If people around us seem mostly well-fed and content, then why shouldn’t everybody else be?

Although things are improving, a huge chunk of the world’s population remain poor. Nearly a fifth of humans, 1.29 billion, are considered extremely poor . In effect the equivalent of every man, woman and child in Europe, the United States and the Middle East scrape by on 75 British pence a day adjusted for the cost of living in each country. About a third of the world lives on less than $2 a day. The poorest half of the world – 3.5 billion people – own only 0.71% of the world’s wealth between them.

A billion people live in chronic hunger. Nearly a third of all children are chronically malnourished, which unless addressed before the age of two often leaves them stunted and mentally impaired.  A sixth of the world’s adults can’t read or write and many more have only rudimentary literacy. Sub-Saharan Africa has only two doctors for every 10,000 people, which is partly why on average its inhabitants live to an average age of 56.

Rather than a term like “developing” to describe these people and countries, the travel writer Dervla Murphy’s phrase “majority world” is more accurate.

2. Most countries aren’t well-off. The following graph using World Bank data shows that most countries have a relatively low level of national income per capita. 120 nations earn less per person than the world average. When you reach an income per capita of about US$20,000, about half that of the UK, there’s a big jump. Bermudan national income per person is US$104,590, 455 times that of the Democratic Republic of the Congo.

National income per capita, US$

Per capita income by country

[NB. Not all country labels fit on the vertical graph.]

3. More poor people live in Asia than in Africa. Everybody seems to be wittering on about the Asian Century these days – and Asian development has been miraculous. But about 69% of Indians live on less than US$2 per day: 850 million people. A third of Chinese, 400 million, remain similarly poor despite the country’s amazing success in reducing poverty. Together those two countries contain more poor people than there are Africans.

4. The distinction between “developed” and “developing” countries is meaningless.  What’s Brazil got to do with Liberia? Not much, apart from an Atlantic coast. One is a newly-industrialising behemoth with an average income near the world average. The other is one of the world’s poorest, emerging from war. Yet both are officially considered developing. China, Turkey, Russia, Indonesia, Mexico and India are all big and relatively dynamic even if they also contain a lot of poor people. Millions of people in those countries live just like Europeans, and the emergence of these nations is one of the biggest reasons why poverty will continue to drop in the coming decades. Yet plenty countries also called developing are being left behind. I count 41 supposedly developing nations which in 2012 on some criterion had real incomes that were lower than a decade earlier. They’re probably better described as undeveloping.

5. Lying on the beach in Thailand or Gambia doesn’t tell you much about poverty. We still don’t know as much as we should about poverty and we try to ignore poor people. Most people’s experience of the global poor is the waiter at their table or the pool attendant, the ones lucky enough to have jobs. Only by direct experience and immersion in local circumstances is it possible to have a vague inkling of what it might be like to be genuinely destitute. There’s no obligation on holidaymakers to go wandering around in slums, but anybody who claims knowledge about deprivation should experience or observe it first-hand for themselves, ideally for a long time.

6. Our main tool for understanding poor countries – mainstream economics – is woefully inadequate and all about the rich world. A sample of 76,000 economics journal articles published between 1985 and 2005 shows that more papers were published about the United States than on Europe, Asia, Latin America, the Middle East and Africa combined. Like I said in this blog post, that’s as ridiculous as if biologists researched only flowers, or physicists only outer space. It’s no wonder that the mainstream model of human beings bears no resemblance to most people on the planet. Economists start from the assumption that humans are individualistic, utility-maximising and strictly rational in a narrow sense. Actually many people are communitarian, social, non-calculating, uncertain about the future and often act according to sentiment or whim. Mainstream economics allows no theory of power or politics and can’t see the world economy as a system.

7. The economic statistics on poor countries are awful. Which undermines my first four points. As Morten Jerven says in his book Poor Numbers: How We Are Misled By African Development Statistics And What To Do About It, “the most basic metric of development, GDP, should not be treated as an objective number but rather as a number that is a product of a process in which a range of arbitrary and controversial assumptions are made.” Jerven finds that the discrepancy between different GDP estimates is up to a half in some cases. This supports my experience from working in the least developed countries, where statistics offices are usually underfunded and don’t have the resources to collect data often or well enough.

There’s a kind of false scientism: foreign academic economists spend ages refining complicated econometric models despite the raw material being rubbish. In the absence of good numbers, the only immediate alternative is to live in a country, to use good theory and to rely where necessary on case studies and even anecdote.

8. We need somewhere to make our T-shirts. The global development story is all about how wonderful it would be if we could end poverty. But the current economic system relies on cheapness. Capitalism functions partly via its ability to maintain low wages. Why has global inflation been so low over the past decade or more? Partly, the China effect, whereby the opening up of huge untapped labour markets meant that whole Western industries could outsource their manufacturing and that new local manufacturers could emerge. China’s rural poor keep Foxconn workers on their toes – if you don’t like assembling iPhones at US$18 for a 10-hour day (much higher than it used to be) 1000 people are waiting to take your place.

Nairobi’s Kibera slum-dwellers and rural poor keep wages low by functioning as a reserve army of labour willing to work for peanuts. In Haiti garment manufacturers recently argued that a minimum wage rise to the equivalent of five dollars a day would kill their business. Wikileaks published documents showing that the United States government earlier fought to cap daily pay at three dollars. The country’s only major export industry is clothing destined for the United States.

It’d be worth paying a lot more for our t-shirts if it meant that the people who made them had decent lives. An increase in demand via higher wages would support economic growth. But it’s also naïve to think that western consumers would pay much more for their t-shirts or that businesses would tolerate big wage hikes.

9. Inequality matters at least as much as poverty. A report from Oxfam last month pointed out that 85 people, about as many as would fit on a double-decker bus, own as much wealth as the bottom half of the world’s population.

The Spirit Level by Kate Pickett and Richard Wilkinson shows that equality is good for everyone. Redistribution reduces poverty and makes life better for the rich in the form of less crime, better education and a more cohesive society.  Global inequality is getting worse, not better. If we don’t radically reduce inequality the poor will eat us, so aid isn’t an option, and it’s not about the rich world “saving” the poor. It’s essential for everyone.

10. Africa isn’t a country. Although sub-Saharan Africa’s economy is still much smaller than Britain’s, some Africans are fat, go to the supermarket and drive cars. Many are very poor. The rise of the African middle class is one of the most under-reported stories of our times. If people in the UK think about the continent at all they think of the Ethiopian famine of the 1980s. Partly this is the fault of the major news media, which have cut back on foreign coverage so much that all they report on is Big Events – a bomb, a famine, a war. Reporters who occasionally fly in from abroad miss the cumulative series of small happenings that amount to a trend. To show only negative TV stories about Africa smears the whole continent. The Central African Republic isn’t Botswana, which isn’t Namibia. Within countries the divide between urban and rural populations is increasingly stark.

11. Not all poor countries are corrupt. Corruption tends to be more obvious in some poor countries because the police aren’t very good, the rule of law isn’t established and small-scale bribery may have become entrenched, but a country isn’t necessarily poor because the wealth has all been stolen. All sorts of other more important reasons explain poverty, like political instability, bad economic policy, colonial history, an over-reliance on tropical commodities, distance from major markets, being landlocked and poor health and education.

Relatively uncorrupt poor countries I’ve worked in or on include Vanuatu, Fiji, Kiribati, Tuvalu, Samoa, Tonga, the Federated States of Micronesia, Bhutan, Cape Verde and Mauritius. Arguably a good hundred others are less corrupt than when the United States or Britain were industrialising.

In the UK until the early 1800s it was perfectly normal for ministers to ‘borrow’ their departmental funds for personal profit. Until 1870, appointments of high-ranking civil servants in Britain were made on the basis of patronage rather than merit. The British government chief whip was actually called the patronage secretary of the Treasury because distributing patronage was his main job. (h/t M. Ibrahim) This was at a time when Britain became the first superpower.

Arguably the banking industry and its takeover of American and European governments represents a far bigger and more dangerous form of corruption than even the bribery and political theft that blights the likes of Nigeria. In the US and UK lobbying is a multi-billion dollar business which subverts the democratic process. From 2008 onwards , encouraged by lobbyists, the UK government committed to spending a staggering trillion pounds on the bank bailout, which is about ten years’ worth of National Health Service funding. It wasn’t as obvious as baksheesh but it amounted to the same thing only on a vastly larger scale. One academic estimates that by the end of 2012 the UK bailout had cost the taxpayer up to 13% of one year’s economic production.

Corruption doesn’t necessarily cause poverty: that’s like blaming poor countries for their own failures. In some cases quite the reverse can be true. Some people argue that corruption has helped national politicians align their interests with that of their country. Indonesia’s President Suharto understood that if he generated wealth there’d be more to steal, so he installed a team of technocrats whose sole job it was to grow the economy; immoral but effective.

12. Money doesn’t make you happy. Up to about US$75,000 a year it does – and most people aren’t anywhere near that level – but beyond that it doesn’t have any effect, according to Nobel prize-winning psychologist Daniel Kahneman. “The four basic needs: food, housing, clothes and medicine must be cheap and easy for everybody. That’s civilisation”, says Jon Jandai, a farmer from northeast Thailand. I’d add primary, secondary and tertiary education, too.

13. Poor countries can learn from the mistakes of the rich on the environment and life satisfaction. Lower income countries have leapfrogged some technologies. For example many will never install fixed telephone lines because mobile coverage is so good. Vast numbers of people will never touch a PC, doing all their computing on a smartphone or tablet.

The governments of poor countries should be more adventurous, leapfrogging ideologies too. Some proponents of economic growth argue that environmental sustainability and a focus on happiness will handicap poverty reduction. But it could enable some countries to prioritise the important things in life. Endless growth is impossible and undesirable.

Beyond a certain point rich inefficiency is the real problem. Why do developing countries ape the development paths and economic structures of the West? We are wage slaves who perform bullshit jobs so that we can service our mortgages. The advance of the car ruined everyone’s quality of life so that a minority can sit in air-conditioned metal boxes in jams. Clever though-leadership in the majority world could lead the way for the rich. Bhutan’s idea of Gross National Happiness is an example.

14. The world isn’t overpopulated. There’s plenty of food to go round. World agriculture produces 17% more calories per person today than it did 30 years ago despite a 70% population increase, due to rising yields, higher farming intensity and more use of land. The real problems are the system of distribution and energy use.  If the rich world didn’t hog all the food and produce it inefficiently there’d be enough for everyone.

15. Governments often do things better than markets. Market fundamentalism is the new global creed, and yet most countries that developed successfully did it initially via heavy government intervention. Markets suffer from serious coordination failure. The global free-flow of capital and trade renders poor countries more vulnerable. As the United Kingdom has proven, natural monopolies like the railways, post office and water and electricity utilities are better off in public ownership. In poorer countries the case for government ownership is even stronger.

16. Most countries that successfully reduced poverty didn’t directly try to reduce poverty. They aimed at economic transformation. A fall in poverty was an indirect result of an increase in productive capacity. Investment rates and capital accumulation were high and aimed at enterprise development and technological improvement, as well as structural change toward developing the non-traditional sectors, including linkages to agriculture and the wider economy.

This sort of obliquity is what John Kay talks about in his book of the same name. If you try to target things directly you often fail.

17. How rich countries behave is often more important than how much they spend on aid. The 2008 global economic crisis, which was caused largely by the financial sector, increased poverty for hundreds of millions of people. The collapse in international trade hurt all countries, developing and industrialised. But while the big and emerging nations might recover, the poorest couldn’t cope. A downturn in exports can be life-and-death. When European orders stopped coming, Kenyan flower farm workers simply sat idle. Foreign investment inflows also dwindled. There is a large group at the global periphery which won’t rebound for a long time — and for many people, it is already too late.

Nicholas Shaxson’s excellent book Treasure Islands suggests that Transparency International’s corruption perceptions index has things the wrong way round: we should rank countries on banking secrecy, not graft. The real economic issue is that rich nations harbour ill-gotten spoils, not that Charles Taylor foists himself on Liberia.

18. Just give them the f-ing money, as Bob Geldof sort-of said. Daily Mail readers seem to think that the world has already given enough aid, but in reality an enormous amount remains to be done, as should be clear from points 1 and 9. More aid should be in the form grants rather than loans. Cash transfers are the best way of delivering some help. For example the British Department for International Development works with Unicef and the Kenyan Government in Korogocho, Nairobi, to improve the lives of orphans and vulnerable children through a cash transfer scheme which gives very poor families 3000 Kenyan shillings (about £25) every two months for help with basic household expenses. It cuts out the middleman and it’s been proven through robust testing to reduce poverty, hunger and inequality.

19. Rich countries don’t spend much on aid. The amount officially spent on each poor person globally is US$20 a year, according to the World Bank. The amount has doubled in the last decade following a dip in the late 1990s. But several opinion polls show that rich country inhabitants think they’re much more generous than they really are. Americans think that their government spends 28% of the budget on aid when it’s really about 1%. Brits are almost as bad. The result of this widespread overestimation of generosity is that many people in rich countries want to cut aid.

20. Aid works: both developmental and humanitarian. It’s not widely known that development aid was instrumental in supporting the growth of Singapore, one of the world’s most remarkable economic success stories. The United Nations Development Programme contributed 744 technical assistants from 1950 onwards and spent US$27 million on development help. In 1960 a visiting UNDP team led by Dutchman Dr Albert Winsemius, who became a trusted adviser to Lee Kuan Yew until the 1980s, wrote a report entitled “A proposed industrialisation programme for the State of Singapore”. This document formed the basis of early development strategy. Other major aid recipients that now receive very little include Botswana, Morocco, Brazil, Mexico, Chile, Costa Rica, Peru, Thailand, Mauritius and Malaysia. Bill Gates reckons that through a combination of aid and spontaneous economic development there won’t be any very poor people left by 2035.

He calculates that 100 million deaths have been avoided since the drop in child mortality since 1980, the start of the “Child Survival Revolution” that made vaccines and oral rehydration therapy much more widespread. Total aid, $500 billion, counts money for vaccines, HIV/AIDS, family planning, and water and sanitation from all donors. That works out at US$5000  per life saved, which he rightly says is quite cheap. Hundreds of millions of people have been immunized against Polio, treated for TB and given anti-retroviral treatment for HIV/AIDS.

21. Charity sometimes isn’t the best way of tackling poverty. Sometimes it is. Just because a service is provided freely or from donations doesn’t mean it is better.  Often governments are better-placed to deliver assistance because they have better expertise, economies of scale and political access. Taxation places a similar burden on everyone and makes aid revenues more predictable. Sometimes, though, charities have better access and niche skills. Volunteer organisations often have a long history in certain locations and they can avoid accusations of political interference.

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166 Comments leave one →
  1. Alan Gay permalink
    February 24, 2014 5:14 pm

    Some real home truths here, but who is listening?

    • Sopa permalink
      February 27, 2014 7:20 am

      My point also Alan. “if only there are willing ears’

  2. Andrew permalink
    February 24, 2014 9:31 pm

    I’m listening! … brilliant post, so many good points.

  3. Jonathan Said permalink
    February 25, 2014 6:47 am

    Many good points, especially number 16. But I take issue with your last 4 as these seem to conflict with point 16 about economic transformation. Cash transfers can work at the localised level if done properly but they are not the solution. Aid can be very counter productive by limiting a country’s ability to transform its economy. This is because of its implications of economic institutions and on the political economy – two key factors that you fail to mention. Institutions reduce poverty, but allowing economic transformation. Aid can be useful, but is often detrimental to allow local economic institutions to emerge.

    • February 25, 2014 8:12 am

      Thanks Jonathan. Perhaps the phrasing of my point about cash transfers is wrong. I didn’t mean to suggest they are the solution, only part of it, and that they should be used more widely because the evidence is strong that they work, and that they do bring people at the bottom end of the spectrum into the cash economy and actually help economic growth. The overall message of that point is that I think aid should be seen partly as income redistribution, which is why I think it should be based a lot on the unmediated transfer of funds.

      I understand your doubts about aid but i’ve seen so many examples of it working when used well, and not in a way that limits the emergence of local economic institutions. In Singapore, the example I cite, it was used to nurture and then buttress local institutions, in fact the Economic Development Board, the architect of success, was a product partly of aid via the UNDP. A lot of my own work aims to diagnose institutional problems and support institutions with aid money, in a direction that fits the local context.

      You’re right, I should also have probably made more mention of political economy.

  4. Jenni Barr permalink
    February 26, 2014 11:37 am

    Shared on Facebook. Great article with a lot to chew on

    • February 26, 2014 12:37 pm

      Thanks Jenni. Lots of feedback from various media — FB, Reddit, Twitter and email. In some ways it’s a pity it’s all so spread out! Progress, eh?

  5. February 27, 2014 10:03 am

    Great points. I was particularly interested in point 10, because I am in the process of conducting a long study of Africa. Most people as you say are still fixated with the view of some hopeless continent racked by war and famine. In fact, currently Ethiopia is one of the fastest growing economies.

    But, I’d be interested in your views on something I was discussing with my son the other day. The AU has committed itself to creating an African equivalent of the EU by 2030, a development I would welcome. But, there are already a number of areas of economic co-operation in Africa that cover basically the East, West, South and North.

    The question is do you think integration would be best served by developing these existing units, and then working towards their integration, or going straight for one single African common market. The former option seems easier, and avoids some of the problems faced by the EU, of divergent economies, but for similar reasons risks establishing these sub units as powerful economic entities (proto-states) in their own right that might mitigate against further economic integration.

  6. February 27, 2014 11:23 am

    Thanks. I’m not sure it’s either/or. Both could exist. I could be wrong but I don’t see much genuine appetite among leaders, beyond political gestures, for a kind of EU-type African Union. An AU common market seems a long way off. Clearly it’s about ceding some power and sovereignty, and like politicians everywhere they don’t like giving away control unless it’s in their interests or they are induced to so by corporates. And it isn’t really in the interests of companies when intra-regional trade and investment is as yet reasonably small (not that it won’t increase).

    At the same time, and for some of the same reasons, although regionalisation at the regional level clearly has more chance of success I am sceptical about how far it will go in the near term. I’m somewhat familiar with East Africa, where there is a lot of grand talk about the East African Community with the eventual goal of a currency union. What’s sometimes overlooked is that the old EAC failed in the 1970s, and that even now there is huge diversity, from Burundi to Kenya. Not enough of the technical work is being done, and periodic crises like South Sudan mean that things remain somewhat notional and political, and that the i’s aren’t dotted or the t’s crossed.

    One of the problems of the eurozone (not the EU) is that there was no political union or mechanism for continent-wide fiscal policy (partly due to a lack of willingness among national governments to give away powers). One interest rate was never going to fit all. If the EU can’t even make it work, then I see less chance of deep integration working in Africa.

    Maybe i’m overly pessimistic, but as good an idea as an EU for Africa might be, it’s a distant prospect and dates like 2030 seem a bit notional rather than being part of a real timetable.

  7. February 27, 2014 7:19 pm

    Reblogged this on OromianEconomist and commented:
    Poverty-as-rule-not -exception is difficult to bend our minds around because we tend to base our views about the world on direct experience. If people around us seem mostly well-fed and content, then why shouldn’t everybody else be?
    We still don’t know as much as we should about poverty and we try to ignore poor people. Most people’s experience of the global poor is the waiter at their table or the pool attendant, the ones lucky enough to have jobs. Only by direct experience and immersion in local circumstances is it possible to have a vague inkling of what it might be like to be genuinely destitute. There’s no obligation on holidaymakers to go wandering around in slums, but anybody who claims knowledge about deprivation should experience or observe it first-hand for themselves, ideally for a long time.
    Which undermines my first four points. As Morten Jerven says in his book Poor Numbers: How We Are Misled By African Development Statistics And What To Do About It, “the most basic metric of development, GDP, should not be treated as an objective number but rather as a number that is a product of a process in which a range of arbitrary and controversial assumptions are made.” Jerven finds that the discrepancy between different GDP estimates is up to a half in some cases. This supports my experience from working in the least developed countries, where statistics offices are usually underfunded and don’t have the resources to collect data often or well enough.

    There’s a kind of false scientism: foreign academic economists spend ages refining complicated econometric models despite the raw material being rubbish. In the absence of good numbers, the only immediate alternative is to live in a country, to use good theory and to rely where necessary on case studies and even anecdote.
    A report from Oxfam last month pointed out that 85 people, about as many as would fit on a double-decker bus, own as much wealth as the bottom half of the world’s population.

    The Spirit Level by Kate Pickett and Richard Wilkinson shows that equality is good for everyone. Redistribution reduces poverty and makes life better for the rich in the form of less crime, better education and a more cohesive society. Global inequality is getting worse, not better. If we don’t radically reduce inequality the poor will eat us, so aid isn’t an option, and it’s not about the rich world “saving” the poor. It’s essential for everyone.

    Although things are improving, a huge chunk of the world’s population remain poor. Over a fifth of humans, 1.29 billion, are considered extremely poor . In effect the equivalent of every man, woman and child in Europe, the United States and the Middle East scrape by on 75 British pence a day adjusted for the cost of living in each country. About a third of the world lives on less than $2 a day. The poorest half of the world – 3.5 billion people – own only 0.71% of the world’s wealth between them.

    A billion people live in chronic hunger. Nearly a third of all children are chronically malnourished, which unless addressed before the age of two often leaves them stunted and mentally impaired. A sixth of the world’s adults can’t read or write and many more have only rudimentary literacy. Sub-Saharan Africa has only two doctors for every 10,000 people, which is partly why on average its inhabitants live to an average age of 56.

    Rather than a term like “developing” to describe these people and countries, the travel writer Dervla Murphy’s phrase “majority world” is more accurate.
    “The four basic needs: food, housing, clothes and medicine must be cheap and easy for everybody. That’s civilisation”, says Jon Jandai, a farmer from northeast Thailand. I’d add primary, secondary and tertiary education, too.
    Lower income countries have leapfrogged some technologies. For example many will never install fixed telephone lines because mobile coverage is so good. Vast numbers of people will never touch a PC, doing all their computing on a smartphone or tablet.

    The governments of poor countries should be more adventurous, leapfrogging ideologies too. Some proponents of economic growth argue that environmental sustainability and a focus on happiness will handicap poverty reduction. But it could enable some countries to prioritise the important things in life. Endless growth is impossible and undesirable.

    Beyond a certain point rich inefficiency is the real problem. Why do developing countries ape the development paths and economic structures of the West? We are wage slaves who perform bullshit jobs so that we can service our mortgages. The advance of the car ruined everyone’s quality of life so that a minority can sit in air-conditioned metal boxes in jams. Clever though-leadership in the majority world could lead the way for the rich. Bhutan’s idea of Gross National Happiness is an example.
    There’s plenty of food to go round. World agriculture produces 17% more calories per person today than it did 30 years ago despite a 70% population increase, due to rising yields, higher farming intensity and more use of land. The real problems are the system of distribution and energy use. If the rich world didn’t hog all the food and produce it inefficiently there’d be enough for everyone.
    The amount officially spent on each poor person globally is US$20 a year, according to the World Bank. The amount has doubled in the last decade following a dip in the late 1990s. But several opinion polls show that rich country inhabitants think they’re much more generous than they really are. Americans think that their government spends 28% of the budget on aid when it’s really about 1%. Brits are almost as bad. The result of this widespread overestimation of generosity is that many people in rich countries want to cut aid.
    https://emergenteconomics.com/2014/02/24/21-things-they-never-tell-you-about-poor-countries/

    • Pat Knoebel permalink
      November 6, 2016 6:32 pm

      Too Many people….. This article says otherwise. I strongly disagree. Just because there is enough food does not mean we have a right to over-burden our dear Gaia.

  8. February 28, 2014 4:46 pm

    Reblogged this on 天雨流芳.

  9. February 28, 2014 5:04 pm

    Reblogged this on jrosa754 and commented:
    Truth my friends…truth

  10. nepalilovestory permalink
    February 28, 2014 5:25 pm

    Some really interesting points here. Will definitely be sharing this post!

  11. February 28, 2014 5:27 pm

    Reblogged this on henrihendricks and commented:
    Wow

  12. February 28, 2014 5:31 pm

    Excellent post. Number 6 was my absolute favorite. I think it’s so true that Western culture automatically assume that everyone else is individualistic like them. When you’re absolutely right, that most are collectivist. Thanks for your perspective! I hope someone who doesn’t have this perspective reads this!

    • March 1, 2014 2:01 am

      Thanks, yes, It does seem to be the automatic assumption that the rest of the world is like Europe or the US. But as you say it’s not; without wishing to romanticise the poor, people often seem to have much stronger community bonds and senses of social obligation. Mainstream economics wrongly assumes strict individualism

  13. Galaxian permalink
    February 28, 2014 5:46 pm

    I think the shape of the per-capita income curve–exponential, with most of the income concentrated at one end, explains it all. Wealth and feelings of well-being are relative to how your neighbors are doing. To feel you have enjoyed “increase,” you need, say, 10% more than your neighbors are getting. Then the next fella above needs 10% more than you, or 21% above baseline. This leads to a geometric progression. 100 iterations of this formula in a hierarchical social system leads to top incomes more than 13,000 times the bottom income. That’s why I’m not too optimistic regarding prospects for equalizing standards of welfare around the world.

    • March 1, 2014 8:34 am

      No, you’re right, greed and envy drive a lot of conspicuous consumption. Arguing for equality is idealistic without some sort of hard analysis of why it might happen and how. But I suspect that at least part of the problem is that a lot of people don’t know the extent of inequality or have any inkling of what it means. So it’s at least worth pointing out. And the dominance of the ‘poverty’ narrative, rather than a discussion of inequality in development policy implies that it’s OK for the well-off to keep enriching themselves as long as they throw a few crumbs to the poor.

      • Galaxian permalink
        March 1, 2014 1:46 pm

        A geometric progression of income differentials only requires a modest degree of individual acquisitiveness to maintain–the large number of layers is what matters. Overall, you have a good post. I agree that eliminating secret bank accounts is a step–the concealability of money seems a factor in social inequality as well.

  14. February 28, 2014 6:01 pm

    Reblogged this on naeex.

  15. tizi91 permalink
    February 28, 2014 6:02 pm

    Really good points!! Congratulation for This post 🙂 bravo!!

  16. February 28, 2014 6:06 pm

    Reblogged this on throughttheundercurrent.

  17. February 28, 2014 6:12 pm

    I cannot believe you can write an entire article on global poverty and use the word “woman” ONCE. Jesus Christ, talk about a blind spot.

    • March 1, 2014 1:55 am

      To be fair I didn’t use the word ‘man’ either, and whilst gender inequality is iniquitous and inexcusable i don’t see it as a major explanation for poverty; perhaps more a manifestation of it. And it’s pretty bad in the rich world, too.

    • November 25, 2016 1:40 pm

      As one of those less than rare things a woman that does live in abject poverty in UK – £20 a week, let me tell you stop using elite bullshit to turn me against my male equivalent those in poverty have equality with each other what we don’t have equality with is middle class and rich ‘feminists’ who think our purpose is for them to get a bigger share of a pie that we aren’t getting anything from.

  18. February 28, 2014 6:20 pm

    Brilliant post. Authentic and assertive assessment of the situation.

  19. February 28, 2014 6:36 pm

    Very well done. You present a lot of information in a clear precise way. I agree with much of what you say, disagree with some, but over all support what you are trying to say. Keep up the good work.

  20. February 28, 2014 6:53 pm

    Hmm, not sure how to comment, but felt compelled to… How do you measure wealth? By money? Way of life? Happiness? I would love to have no money, no responsibility, and have the government stop bothering me for more of my money to give to many folks that just think they deserve it.
    Congrats on getting pressed!!

  21. February 28, 2014 8:00 pm

    Nice post. Very thoughtful 🙂

  22. February 28, 2014 8:22 pm

    Reblogged this on Apps Lotus's Blog.

  23. February 28, 2014 8:32 pm

    Very useful article. hope more people will be able to read it

  24. February 28, 2014 8:38 pm

    Reblogged this on INTO THE AUGUST RED and commented:
    This information is quite accurate and needs to be heard!!! Let’s educate ourselves in 2014!!

  25. February 28, 2014 8:59 pm

    Really, really good. I have just began a blog in a similar vein. Have a look please and see what you think.

    I too feel that GDP needs hugely reworking to include health care and environmental efficiency, and how sustainable countries energy use is. We just can’t continue consuming to keep the money cycle going. The current system cannot absorb sustainable or built to last ideas or services, as by its inherent efficient nature it will not be profit maximising.

  26. February 28, 2014 9:00 pm

    This is a wonderful article…I just wish everyone could read it and understand.

  27. February 28, 2014 9:01 pm

    It’s antennaup.wordpress.com

  28. February 28, 2014 10:46 pm

    Interesting read some insights too, Africa happens to be rich in natural resources for instance gold, diamonds, oil, copper, forests etc which benefit in most cases “developed worlds” as opposed to Africans. I do wander what can be done to use the same resources to feed & develop Africa?

  29. nikkiharvey permalink
    March 1, 2014 12:19 am

    Many good points. On the idea of governments sending over aid, I think as a percentage of what is spent on aid, they send too much money as actual money. Increase the amount spent, but rather than just sending money to countries, pay to send people over that have needed skills.
    I also wanted to add, you say about the terms developed and developing- I dislike these terms, because it implies that developed countries are finished, they might be better off than those classified as developing, but there are still many areas of improvement. They definitely aren’t finished developing.

  30. March 1, 2014 12:26 am

    Reblogged this on ayjchiu.

  31. March 1, 2014 12:47 am

    Good job !! check my blog 🙂

  32. March 1, 2014 1:58 am

    Thanks all so much for the kind comments. It’s really rewarding to be able to communicate these ideas with so many people and to know that there’s a receptive audience for new(ish) ideas about poverty and inequality. The post really does seem to have touched a nerve, somehow.

  33. March 1, 2014 4:14 am

    Very nice post… 🙂

  34. March 1, 2014 5:28 am

    good post…keep doing it…as I am new blogger I posted couple of blogs and not able to get that much popularity please visit my blog http://mindtechnorms.wordpress.com …please help me by reading by any blog (as I read yours) and try to find is there any writing issues or I’m expecting too early…your valuable comments will really boost my writing skills…

  35. March 1, 2014 6:31 am

    If we could step away from the arrogance we seem to have as “World SuperPower” and stop thinking that every “less than” country actually WANTS To be like us, maybe we could get somewhere.. . It’s called Ethnocentrism and it keeps us in a Hamster Wheel of recycled solutions

  36. March 1, 2014 11:22 am

    Reblogged this on thatingenue and commented:
    Poverty is a much bigger issue for everyone these days to recognise. The fact that you are able to read this with an electronic gadget already proves that you are fortunate enough to be given birth to a richer country. Never underestimate the current situation of poverty.

    • March 4, 2014 3:13 am

      Couldn’t have said it better, yiyingggg. How many of us complain about what we have and what we want. “If I could buy a new car, my wife and I would not have to share the one car.” “If only I had a bigger kitchen, then I could prepare more elaborate meals.” Be appreciative of what you have, and remember that someone somewhere else has it much worse than you.

  37. March 1, 2014 12:16 pm

    Sounds like a basic course for understanding the world. Reminds me of a book, The Ugly American. We tend to associate everything to our culture and our world and it just does not fit. Preconceived thoughts limit the process. Good post.

  38. March 1, 2014 12:38 pm

    Reblogged this on Panoramics.

  39. March 1, 2014 2:47 pm

    Reblogged this on Southern Vein Care and commented:

    Great Saturday morning read.

  40. March 1, 2014 5:14 pm

    Reblogged this on Finding Home Inside and commented:
    Something to ponder about. This will change your view on the current state of things in the world.

  41. March 1, 2014 5:36 pm

    Reblogged this on The Dynamic Duover.

  42. March 1, 2014 6:12 pm

    Hello; Freshly Pressed brought me here. I scrolled down to number 8 and I think that paragraph was very true. Western civilization is hooked on cheap labor. It always has been. With so many people in another country wanting a job, everyone is considered a dime-a-dozen. But people in some western countries want a job too. High unemployment in the USA and other western countries is never going to go down if “we” don’t figure something out. That’s all for now, thanks!

  43. enlevementepave60 permalink
    March 1, 2014 6:50 pm

    Reblogged this on Enlèvement d'épave sur le 60, 78, 95, 94, 93, 92 et 91 and commented:
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  44. Curtis Slone permalink
    March 1, 2014 8:43 pm

    Incredible post.

  45. March 1, 2014 8:55 pm

    Reblogged this on samcullimore17's Blog.

  46. March 2, 2014 5:52 pm

    Reblogged this on India plays and commented:
    Well written article on poverty. Covers a lot of points. Yes, for us average readers there is hardly any way to ascertain the numbers used and figures given. The author does not provide any references or sources of the numbers quoted.

    For me, it’s clear that the author does not understand the idea that many people may earn less than dollar two per day still might live very comfortably. A farmer having a family of five with average income of 2 USD per day has total income of 10 USD per day. Given the fact that most farmers manage to have food grains , vegetables and milk by themselves, do not require gym to exercise, live in close community not requiring mobiles and internets or cars, this income is better than some low income industrial workers. This fact becomes even more clear when you factor in cheap electricity ( if there is any), no reliance on taxi’s , no use of maids, dislike for over priced pizzas and nearly free water.

    I am sure , most westerners, who spend 60-120 USD per month only on mobile phone bills are not aware of simple living. I am not forming any opinion nor judging the post written. I am just not sure how wise it is to define poverty only on the basis of money.

    Happy reading!

    • March 2, 2014 7:11 pm

      Have you actually read the piece? I use the terms ‘according to the World Bank’ and ‘using World Bank data’, as well as linking to the data sources.

      I understand quite well that it is possible to achieve some degree of life satisfaction without inordinate wealth. Points 12 and 13 are about how money doesn’t make you happy, beyond a certain point. But you try living in a very low-income country like South Sudan or the Central African Republic on less than $2 a day. I suspect you wouldn’t feel very happy.

  47. March 2, 2014 6:09 pm

    This is amazing, many of these factors also manifest subtly in the prejudices against African and Asian people!! And the so-called Third world country comment is hilarious and inane!

  48. Missey-Jane permalink
    March 2, 2014 7:27 pm

    Reblogged this on misseyjane.

  49. Rana permalink
    March 2, 2014 7:45 pm

    “Economists start from the assumption that humans are individualistic, utility-maximising and strictly rational in a narrow sense. Actually many people are communitarian, social, non-calculating, uncertain about the future and often act according to sentiment or whim. ” I totally agree. Rather than this, I think that many rich countries shows like they are willing to take part in improving poor countries’ economy, politics and health issues but are actually benefiting from their situation. There are many non-profit organisations that aim to help reduce hunger and diseases in African countries but it’s debatable how far they can go without a serious infrastructure.

    • March 9, 2014 11:19 am

      truly said………every one is helping themselves.Charity is just a pretence.Non-profit organizations are biggest beneficiary is these situation.There aim is not to decrease poverty but to maintain them at a certain level so they can maintain there interoperability and profitability.

      • March 9, 2014 12:56 pm

        That must rank as one of the most confused and wrongheaded statements on this thread. What have you been smoking? Non-profit organisations want to increase their profitability? Eh?

  50. March 2, 2014 9:16 pm

    it is the g greed of the ruling classes that is causing poverty to spread worldwide

  51. March 2, 2014 9:43 pm

    Eye opener really!!! Thnk you very much…

  52. March 3, 2014 2:13 am

    Reblogged this on Business Idears and commented:
    Very interesting Points. Good Read.

  53. March 3, 2014 3:03 am

    #13 rings so true. Money doesn’t make you happy.
    I know first hand, seen it second hand, and hear about it third hand.

    Doing something you love (so long as it’s not at a huge loss) makes you happy. I chose happiness over money. I run my own business, volunteer to help, and give to charities, and I haven’t looked back! 😀

    Society as a whole tends to turn a blind eye to things of importance as they don’t believe it affects them… until the day it really hits home. It’s all a matter of stance and perspective at any one point in time. If only people could see and understand…

    xx

  54. March 3, 2014 9:30 am

    Reblogged this on Benji Man's Blogs and commented:
    It’s great hearing alternate perspectives, especially when they actually make more sense.

  55. March 3, 2014 1:18 pm

    This is right on. I live in Thailand and I have seen first hand most of the points made on this list. There’s an upscale hotel in our town that costs 20,000 baht for one night. We know of farmers in the area who make the same amount in one YEAR.

    These same farmers are sometimes jailed for drug trafficking or growing opium, as some of them see it as the only way to get ahead. I once told an Australian tourist the problem with the farmers being tempted by the drug trade and he asked me, “Why do they want to grow opium?” I told him, “Simple. They get a lot more money for opium than they do for corn.” He then asked the most audacious question I have ever heard.

    “What do they need money for?”

    This is the attitude of the “rich” in the “developed” world. They don’t get it that poor people have bills to pay, kids to send to school, sick parents in need of medical care, and farms that require equipment and supplies to keep them running.

    I hope that Australian guy reads your blog.

  56. March 3, 2014 4:26 pm

    Reblogged this on القراءة فيما بعد ثورة المعلومات and commented:
    Detailed and realistic worldview

  57. March 3, 2014 5:29 pm

    Something feel good to listen & read, but experience a fact is different.

  58. March 3, 2014 7:17 pm

    Great post, I learned a couple things I knew deep in my heart but had no real knowledge of. Was a very enjoyable read. Please check my blog! I’m also new to the scene! It’s short, entertaining and sweet. It’s promoting the same goals but through different means. I could use some feedback(I have none), but I’ve just kept going! Worth a read.

  59. March 4, 2014 3:14 am

    Reblogged this on th3bak3rman (The Baker Man).

  60. March 4, 2014 6:24 pm

    Reblogged this on Wonder Sonder and commented:
    A fantastic look into how sociopolitics shape our understanding of economics.

  61. cooperspb permalink
    March 4, 2014 10:43 pm

    Reblogged this on cooperbarrel and commented:
    Some points I’d never considered before. Great read.

  62. March 5, 2014 3:53 am

    Thanks for the humbling post.

  63. March 5, 2014 7:27 am

    Reblogged this on The World's Chronicle.

  64. March 5, 2014 9:13 am

    Is there anyone truly interested in reducing poverty? History has shown that most politicians just care about their own pockets and being reelected!

    • March 6, 2014 9:16 pm

      I think many politicians in wealthy countries have figured out that development spending is a good way of winning the votes of the ‘concerned’ middle class. I suspect that among some politicians there’s a genuine feeling of altruism, for many it’s a rather calculating move, and for some aid is a means of projecting power and influence. Some politicians probably fit into all three camps. If these sometimes cynical motives sometimes result in beneficial initiatives, then all the better.

    • March 9, 2014 10:20 am

      So true so true

  65. March 5, 2014 2:40 pm

    Charity is never the answer. It doesn’t work here in South Africa, and I don’t think it works anywhere else.

    • Andrew permalink
      March 5, 2014 8:39 pm

      Sorry Desire, but that’s not the case – solidarity and charity are effective in overcoming problems. The UK’s National Health Services as discouraged because it was equal to all – now it is regarded as more efficient than just about any health service in the world, and open to all at the point of need. It is not perfect, but it works on almost every level.

      • onyango fred permalink
        November 13, 2016 4:12 pm

        For sure i agree with a drew on the point that charity at a greater point works vevry well. for example i will tell you of how compassion international as a charitable organization impacted to the life of poor a fricans positively. more especially on accacdemics and providing some other important basic needs like food, shelter and clothings to to the targeted people.very many young pebople have attained theri degrees through this charitable organization. There fore i strongly dis agree witth desire.

  66. March 6, 2014 9:59 am

    Would like info on Bhutan’s idea of Gross National Happiness. Appreciate the depth of material. Thanks

    • March 6, 2014 7:02 pm

      Thanks for the comment. I may do a blog on Gross National Happiness. It’s really interesting. I spent several weeks in Bhutan and visited the institute of GNH, where they assess policies to see if they are conducive to happiness. I met a lot of good and clever people in the country.

      • March 6, 2014 10:46 pm

        I’d be very interested in learning more about GNH.

      • March 11, 2014 7:36 pm

        Please share look forward to any insight you can give to help 3rd world countries. Thanks.

  67. Sharon Nyatanga permalink
    March 6, 2014 4:18 pm

    This is true.originally i am from zimbabwe and in uni now:when i speak,people ask where i come from and dont make an effort to hide their amusement as to how i am interllectual and can speak fluent engliah….hmmm

  68. March 7, 2014 6:52 pm

    I hear, I listen, and the question is what the hell can I do? I live in Jersey – not saying much, but i’m 30 years old and I read posts such as this. Instead of reading this, feeling sympathetic then moving on to the next thing I ask the question again, what-can-I-do?

    Money ultimately makes the world go around and my pockets are extremely low to assist in the aid of a “developing” nation at the drop of a dime. With the way things are can we consider this just a necessity in society? When something/someone is up is it not true that something/someone else is down?

  69. March 7, 2014 7:36 pm

    u said in one of ur point that capitalism supports low wages.Capitalist ideology has emerged as champion after cold war but many intellectuals criticize capitalism because it relies heavily on exploitation of any and all form of resources be it human or natural.Don’t u think it is ripe time to look forward and find a new ideology which focus on equality .What are ur views on revival of communism as it supports formation of classless society?

    • March 8, 2014 10:51 am

      I agree with you that it is time to focus on equality. The Soviet Union bore no relation to what Marx described as communism, as lots of authors have pointed out. A more pertinent question is whether or not the attempt to achieve some measure of equality and environmental sustainability always leads to authoritarianism. That’s what the right-wing would have you believe. I disagree. Humans throughout history have often managed to manage their affairs so that they didn’t destroy nature and their societies were reasonably equal. Humans are incredibly adaptable and together capable of immense technological and social achievements. There’s no reason why a new, fairer system shouldn’t emerge based on fairness and sustainability — but it won’t come about through faith or hope. It needs to be realistic and based on hard-headed analysis.

  70. islander permalink
    March 9, 2014 5:45 am

    Clearly defined – now, how many will admit that colonialism is still driving this situation, both the legacies of past invasions and the continual manipulation of national policies and theft of natural resources today …..

    • March 9, 2014 1:56 pm

      Yes, the unjustified international expropriation of resources is part of the story, but domestic elites do a pretty good job of exploiting their poor, too.

  71. Michael permalink
    March 10, 2014 8:27 pm

    I enjoyed your article, very thought provoking. I wish you had not used the F*** inference in No. 18. Beneath an article and an author such as this.

    • March 10, 2014 8:42 pm

      Thanks. I didn’t mean to be offensive — it was just a reference to a famous comment by Bob Geldof at Live Aid in 1985 when he was appealing to people to donate more money to charities working in Africa.

  72. Vicki permalink
    March 11, 2014 7:39 pm

    I read your article with great interest. My husband and I have spent 22 years living outside of America. We have lived in Southern Africa, Turkey and Germany so we have seen a variety of economies. We have visited even more countries and yes the poor are always with us. I have come to grips with the fact that I personally can not fix all of these problems. We have been directly involved in helping refugees as they transition through Turkey, been involved in earth quake relief efforts and devoted many hours to helping others. We don’t directly give money to any one family because it causes too many problems in whole communities. We have given anonymously through third parties in times of dire need such as health crises or to help pay a heating bill. We have tried to help people connect with job opportunities or help set up training classes to improve job skills. In many ways, these efforts are just a drop in the bucket of the much bigger issues.

    One of the most important lessons that I have learned is that giving people their dignity can be almost as important as a hand out. If I am willing to sit on the floor of a mud hut and drink tea while my children play outside with goats running around, I am sending the message that I am not better or superior.

    War, famine, drought, plagues such as HIV/AIDS as well as corrupt governments are all local problems that seem to be ongoing in so many parts of the world. Many people live just on the edge of economic disaster and do fine until something like war or drought wreak havoc on them. For others survival is a daily struggle for which there just doesn’t seem to be an answer. Certainly aid in times of natural disaster or war is essential. We are all part of the human race and we all may need help at some point in our lives.

    Is communism or socialism the answer? My observation is that many times those systems breed a society that expects some one else to sort it out. Individuals loose the desire to help their neighbor because it becomes the governments concern. I like the idea of benevolent capitalism where people have opportunities and yet some basic undergirding is in place such as education, health care and unemployment benefits. For many just having access to clean water and proper housing is a huge plus. Remember hot running water is a luxury in most of the world.

    Loans to needy nations is really not the answer because then those societies are saddled with debt that they can never repay. A few get rich, but the vast majority don’t.

    Should American’s be willing to pay more for goods in order that local laborers can make a proper wage? Yes perhaps we could all pay a little more, but let’s make sure that money really goes to the worker and not the corporate owners. As individuals we can let corporations know that we care about the working conditions and wages of laborers as well as the price of the item.

    An issue that your article didn’t address is the brain drain that so often happens in poorer countries. As people get an education, they are unable to find jobs so they move West for the better life that their education can give them. In turn their home country continues to loose its best and brightest who might be able to help sort out some of their issues.

    Governments and private charities can work together to try and make a difference. Most people around the world are very hard working and just want to live in a place where they feel their children have a future. I have been surprised at how much I have in common with women around the world no matter what their economic standings.

  73. March 12, 2014 4:57 am

    Reblogged this on Fortune Makers and commented:
    Please think about us……

  74. March 13, 2014 2:35 pm

    This post was really interesting!

  75. Ryan permalink
    March 14, 2014 6:07 am

    14. The world isn’t overpopulated. –While I agree with most of what was said, this point seems overly simplistic. Overpopulation is a concept that deals with more than just having enough food to go around. Overpopulation cannot be solely looked at in quantitative measures such as tons of food or available land per capita. The world is overpopulated, and having children that one cannot support is perhaps the biggest contributor to the endless cycle of poverty. Is it a coincidence that the period when China saw the most significant reductions of poverty in human history happened over the same period in which it enforced strict population controls? Everyone uses per capita figures as metrics to rank nations, and everyone focuses on the numerator of those numbers when looking for improvement, but no one considers the denominator. Population control, perhaps justly, has gotten a bad reputation in the past, but certainly providing birth control, sex education, and family planning can do a lot more to reduce poverty than anything else on this list.

    A better way to state this point that I think you were trying to make is that food shortages are a human contruct based on the system of distribution and energy use. “If the rich world didn’t hog all the food and produce it inefficiently there’d be enough for everyone” –It is not the rich countries that are producing food inefficiently. With genetically modified crops with larger yields, pesticides, and modern machinery, it can be argued that the rich contries produce food TOO efficiently, so much so that the governments have to artificially prop up prices so farmers can at least get a decent salary after flooding the local market. Most of what the governments buy up to increase prices goes to waste. In simple economic tems, rice farmers in Myanmar, where I currently live, cannot compete with rice farmers in California. Farmers in general do not farm to provide food to the people of their country out of the goodness of their heart. Here in Myanmar, planting a field of poppies versus a field of rice is purely an economic decision. In a sense, if the rich countries produced LESS food, prices for local farmers will increase, and food shortages will go away.

    • Andrew permalink
      March 14, 2014 8:51 am

      Ryan, interesting points, but I’d agree with Dan that poverty is the problem, and population is secondary. I’d aim for good pro-poor policies and let population adjust itself … it is quite rational for people to have large families right now, but as welfare increases they voluntarily reduce the number of kids. Europe reduced its birthrate without contraception once living standards started improving (including falling death rates).

      The bigger utilitarianism challenge is to ask why we are ‘for making people happy, but neutral about making happy people’. 7 billion was unimaginable even a few decades ago, but projections show a slowing of growth rate, and we see inequality as the biggest challenge to wellbeing rather than absolute resources. To attain moderate living standards for every human on Earth is still perfectly possible, but our economic models fail, and failvery badly, to deliver.

      • March 14, 2014 9:49 am

        Ryan, in support of Andrew’s points, the notion of the demographic dividend is quite standard in the development literature, as population expert Hans Rosling points out here: http://www.gapminder.org/videos/dont-panic-the-facts-about-population/ . As Andrew says, when people are very poor they have large families but when they get richer they have fewer children. So somewhat paradoxically, higher incomes tend to reduce population growth. We should concentrate on redistribution and poverty-reduction rather than try to compel people to reduce family sizes, something which is unlikely to work anyway.

        Having too many children is profoundly not the main cause of poverty. In the GDP per capita equation people certainly do focus on the denominator — too much so, in my view. To suggest that population growth is always a bad thing is to ignore the very basic lesson of economics that people create wealth as well as consume resources. Within an appropriate economic system individuals can be net contributors to welfare rather than simply a drain on resources. The sum of wealth isn’t fixed, only serving so many — and in fact global income distribution is appallingly unequal, as suggested in my point 9. In a healthy economy economy an additional person creates more than she consumes, making the pie bigger. It is income and the design of the economic system that should assume paramount importance, not trying to shrink the denominator.

        The one-child policy played a minor part in China’s economic growth. Far more important were strong government management and intervention, wage suppression, export orientation, a fixed exchange rate, mobilisation of domestic savings, attraction of foreign know-how, globalisation, the development of regional neighbours, etc.

        Lastly, on rich-world government subsidies, the 40 billion euros the EU annually pays to farmers allows them to continue to produce inefficiently and to sell more cheaply than what they otherwise would, pricing their poor-country counterparts out of the market. Similarly US agricultural subsidies of US$ 20 billion per year directly put poor producers out of business. The case of cotton in West Africa is a well-known example. To subsidise global agriculture in rich countries to the tune of many tens of billions of dollars annually is an incredibly inefficient way for the world to produce its food. Some calculate that this is the biggest obstacle to development. Poorer countries have lower wage costs and higher unemployment. Agriculture tends to form a higher proportion of the economy, and in certain areas farmland can be more fertile and available than in the urbanised west, requiring fewer fertilisers or artificial cultivation techniques.

    • Ryan permalink
      March 14, 2014 6:05 pm

      Andrew, I am not so sure I follow (certainly not about the rationality of having a large family now). Yes, it is common knowledge that birthrates decline as a population becomes better off. However, I would simply argue that if that were the conclusion that one would eventually reach, then why not start now? I certainly see inequality as a challenge, I do not disagree on that point, but doesn’t it make sense that inequality gap can be narrowed if those on the bottom end of the spectrum weren’t dividing up their meager wealth among so many offspring? I have serious reservations that we can attain “moderate” (however you define that) living standards with the resources we are given. Certainly that would require those of higher living standards to lower their own consumption. If we defined “moderate” living standards as what is enjoyed by average Americans, then that goal would certainly be unattainable at the current population growth, even if growth rates are already predicted to decline. If the rest of the world consumed as much meat as the average American, sure, we could probably produce enough to allow that, but I cannot even fathom the ecological disaster that would occur, in terms of deforestation, grassland destruction, freshwater consumption, waste disposal, energy required, greenhouse gas emissions, biodiversity, etc. If we are asking the rich to make sacrifices by limiting their personal consumption, is it so unfair to ask the poor (or anyone) to have fewer children? I do not have the exact statistics, but I am sure someone will point out that 1 person from a rich country consumes more than 10 (or whatever) from a poor country, but the problem is those 10 people aspire to consume as much as that first person, and not the other way around, and given a chance they will.

      Dan, I am obviously not as well versed on the literature of development as I would like to be, but that is not my specialty. I came across this purely by accident as it found its way to my facebook newsfeed. Again I want to say that I agree with most points that you have raised, but I am still not convinced that over-population is a myth or does not concern poverty. I will try to checkout the link that you have provided, but I doubt I will be able to watch a 60min streaming video on the internet that I have here. I still fail to see how compelling people to have smaller families cannot be an aspect of poverty-reduction. I do not recall specifically saying that having too many children is the single main cause of poverty (I believe I qualified it with the word ‘perhaps’) but it certainly does not help. If I am near the so-called poverty line myself (we can argue later about what caused my own poverty) and then I have two children, simple economics show that I have now not only made my own situation worse, but I have also created more people in poverty, I single-handedly tripled the people in poverty in my household. I know this argument is overly-simplistic, but think about this, at least as it stands in America now 43% of children born into the bottom economic quintile remain in that bottom quintile as adults, according to a 2012 Pew Economic Mobility Project study. I agree that this mobility has a direct relation income inequality, as I agree with you is a major–perhaps the most pressing–obstacle to overcoming poverty. I simply question why, with the way it stands now without addressing the inequality, would a person who is poor choose to bring a child into the world when they are statistically more likely to remain poor throughout their life. What kind of parent would put that on a child, let alone many? That is what I meant by the endless generational cycle of poverty.

      “To suggest that population growth is always a bad thing is to ignore the very basic lesson of economics that people create wealth as well as consume resources.” –I think you ignore the basic lessons of economics regarding scarcity and finite resources. One cannot continue producing wealth from limited resources because eventually we will run out, or the cost of acquiring more would be enormous, and we cannot use the same resource for two different tasks. If I remember my Econ 101 correctly, the law of diminishing returns, for all productive processes, adding more of one factor of production (in this case, labor or population), while holding all others constant (the Earth’s finite resources), will at some point yield lower per-unit returns.

      “The one-child policy played a minor part in China’s economic growth” –Again, I am not an expert this field, and I will not argue which aspect contributed the most to China’s reduction of poverty, but I believe that the effects of the one-child policy cannot be simply brushed aside. From a quick search I found a study by CUHK economics Professor Zhang Junsen and Professor Li Hongbin, titled “Do High Birth Rates Hamper Economic Growth?” (Review of Economics & Statistics, MIT Press, 2007). (copy and pasted from a website review, excuse my laziness):

      “The research, spanning two decades from 1978 to 1998 and covering 28 Chinese provinces, found that the lower the birth rate, the faster the economic growth. The annual growth rate of the real per capital income during this period was as high as 8.1 percent. At the same time, the birth rate was very low—at only 2 percent.

      According to Prof. Zhang, the research found that the higher the birth rate, the slower the economic growth; and that it is obvious that the One Child Policy has a negative effect on the birth rate. Combining these two findings, the study concludes that the policy has a positive effect on economic growth.”

      I have no clue whether or not Zhang and Li are experts in their field, but I am sure that other similar studies can be produced (again, forgive my laziness).

      For the last point, clearly or definitions of “efficient” are different when it comes to agricultural production. I maintain agricultural production in richer countries is incredibly efficient if you just look at factors of input and output. I would describe traditional ‘slash-and-burn’ agriculture, which is still practiced almost everywhere in the developing world, as terribly inefficient. The inefficiencies for rich countries–I presume we would agree–happen when the government intervenes in the system. I guess where we differ is about the government subsidies. It was my understanding that agriculture subsidies allow farmers to sell at a more expensive price, at least in America, as farmers produce an overabundance and the government buys up the excess to ensure that farmers will not be taken to the cleaners when they go to market, thus allowing them to maintain their livelihood, feed their families, and not go into poverty. In my view, agriculture subsidies are no more than charity for the farmers, which I believe you advocate for (sometimes). Of course, if we are talking about subsidies for agri-business, then perhaps I have totally lost the plot.

      To conclude, I do not believe that population control is the be-all-end-all solution to poverty. I simply think that it is one aspect of a holistic approach to solving this issue. I also take offense to any sort of effort to downplay the effects of over-population. In every ecosystem there is a carrying capacity for a population which it can support sustainably. I believe that we as humans have overstepped that threshold long ago, and we have done irreparable harm as a result. Everyone gets a little uncomfortable whenever someone talks about population control, as it invokes some sort of ‘final solution’ scenario, or fears that we are going to make Catholics wear condoms, heaven forbid. Whenever I bring up Malthus people roll their eyes. Sure, he was wrong about worldwide famines and failed to predict the ‘green revolution’, but he was certainly on point about the explosive human growth rate, and there is no way he could have known that this agricultural revolution would have been driven mostly by fossil fuels, which ecologically still threaten our very existence, and will eventually run out. Another reason it makes people uncomfortable because it actually assumes some personal responsibility on behalf of the poor. No one wants to hear that their poverty is possibly their own fault because they keep having children when they can simply blame the big bad rich bogeyman for hording all the wealth. I have been to a train station in Guangzhou during the New Year holiday, and I know one should not make generalizations based on anecdotal evidence, but if you do not believe the world is over-populated, well then you are not paying attention.

      • Andrew permalink
        March 14, 2014 7:35 pm

        Ryan, loads of interesting points of discussion there, thanks, and can’t do justice to them all in response now! But to pick up on a couple of points:

        The query re why not start now rather than divide assets among more children: if you are in a society with high death rates and no security net, you could see having 4-6 children as rational as follows: two might die, two might be sons to do the farm, one might go to the city, and you might get a couple of girls to help with domestic chores and get water. Its like having a family business … death risk alone would call for having 3 or 4. But they are also your pension, your workers, and on a less mercenary note, your legacy and your abundance when there might be precious little else.

        RE the likelihood of poor kids remaining poor, so is it fair to have them: I think that proves the point the other way, I.e. that there are ingrained inequalities that should be addressed, and the fact that poor people stay poor suggests there a lack of meritocracy. Its worth remembering that in a poor community you may be speaking to a farmer who, with different life chances, might have been a PhD in astrophysics! I’ve even had the same experience in a warehouse in Glasgow Scotland where a guy from a poor area of the city was sharp as a tack and could always win an argument, was always funny, and reflective … but drove a van every day. Same applies in a slum in Nairobi or in a jungle in Liberia. In that context I think it IS getting into slightly worrying eugenics territory to say the poor should restrict their birth rate, when the underlying problem is one of denied life chances.

        Interesting stuff!

    • Pat Knoebel permalink
      November 6, 2016 6:33 pm

      Amen. Over population was not even mentioned in the article. It is the main problem.

  76. March 15, 2014 10:52 am

    Couldn’t have said it better, Andrew. It’s not remotely OK to suggest that poor people should have fewer kids when wealth and opportunity is spread so grossly unevenly in the world. Only when we fix inequality and rich-world profligacy might we begin legitimately to talk about population pressures.

    • Ryan permalink
      March 15, 2014 11:37 am

      To be clear, I do not advocate limiting the number of children that only poor people can have. This applies to all people, rich or poor, and it directly relates to curtailing our consumption. I do not know about the rest of the world, but in America one can become famous simply by pushing out a litter of humans. It does not help that nearly every major religion presses its followers to be fruitful and multiply. I think it is wrong to negate or underestimate the power of irrationality in the world.

      I have not been able to view the full video of Hans Rosling, but I have now read some of the details of his work, and I think I get the message he is trying to raise. I appreciate that he puts it into a form that even ignorant people like me can understand, even swallowing a sword, I guess to show us if we run out of food we can always eat swords, or something like that. Far be it for me to criticize his expertise, as he has clearly spent more time analyzing the data and addressing this problem than I have, but I feel he is also ignoring some major issues himself. I am glad he thinks that humans will be okay, but I cannot share his optimism for the future. He admits himself that he his not an expert on climate. He concedes that energy is still the most pressing obstacle. Again, I haven’t seen everything he presents, but where is his graphs about species extinction in what is called the 6th major extinction event in the history of the world? (again, I am glad humans will be fine). As far as I can tell, the only resource he focused on was fossil fuels. Where is his chart on deforestation, water consumption, desertification, pollution, environmental degradation, etc. We may solve the problem of feeding everyone in Bangladesh, but when the waters rise, where are we going to put them all? He says we can save more children by building a coal plant, but in the end we may be dooming us all. We can save 100% of the hypothetical children that we do not have.

      It is my opinion that Rosling’s statistics are popular because they are optimistic, and he checked it out with numbers and everything, so don’t worry, we got this. like the engineers of the Titanic checked the numbers and proved to us that it was unsinkable, so no need to panic about icebergs. Creating a sense of urgency to the problem, regardless if those immediate warnings may be false, will lead to a better world. How many people do their best work just before a deadline? If we remove the urgency and tell everyone not to panic, they won’t, and then just like procrastinating we are delaying the inevitable. I am sure there is a statistical analysis to back that up.

      To be clear, I agree that tackling inequality is paramount for bringing change. However, when you focus solely on creating equality by solely bringing the top down, you are going to have a hard time. We cannot wait for the next generation to realize that having so many children is detrimental, a fact that most of the world has figured out (which, yes, is a bit of optimism), as I fear by that time it will already be too late.

  77. lovefromdolly permalink
    March 16, 2014 5:21 pm

    Great post. Your point 8. has a lot of relevance for me. We can all start buying fair-trade products, but for things to really change we need to look at the structure and values behind our consumerism.

    • March 17, 2014 9:02 am

      Glad it holds true for you. I also think we need to look beyond consumerist values to the entire system of labour and environmental exploitation.

  78. March 17, 2014 9:13 pm

    Thank you for all this work. It is important to put the truth out there. (Plus I really like your writing style). Thanks again.

  79. Adele Caffrey permalink
    March 22, 2014 5:25 am

    This is a really insightful blog, Dan. Working at the CAB really opens your eyes to poverty in the UK. I’ve given out food vouchers to people whose benefits have stopped through no fault of their own, and I agree with your point about the bank bailout being worse in many ways than smaller scale corruption in poorer countries.

    I’ll be sharing this blog with others!

    • March 24, 2014 8:25 am

      Thanks Adele. I think the experience of exploitation and marginalisation in poor countries is sometimes the mirror image of what happens within the wealthy world. The UK creates immense inequality within its own borders so it is quite happy to do so in the wider world. And yes, corruption is so often misunderstood or defined poorly, not to mention defined unfairly. It’s often a way of further victimising the victims by saying their poverty is their own fault.

  80. March 28, 2014 3:39 pm

    Reblogged this on Har Abada Nasara.

  81. April 1, 2014 7:57 am

    Great article, thought provoking. I would take issue that governments do things better than people though. The government does nothing well, people do things well and sometimes by accident they work for a government.

  82. April 1, 2014 8:01 am

    Reblogged this on Ed Basquill's Blog and commented:
    Thought provoking article with alot of good perspective on the global economy. One doesn’t need to agree with every point to be shaken to reality from our rich people problems: my 401k the obesity epidemic…..

  83. April 4, 2014 7:15 am

    Reblogged this on rantingsphere and commented:
    This is a necessary set of ideas to think about. I would add something about frugal living in rich countries. This is based on some of the work by Stockholm resilience centre around the issue of nine planetary boundaries.

  84. April 4, 2014 11:20 am

    This is incredibly thought-provoking.

    An area, I would like to explore is point 14, the world is not over-populated. I think this should be unpacked. There are issues around food security and food sovereignty, which I have blogged about http://wp.me/p4akpe-1C In addition, there are planetary boundaries that have been explored by people from Stockholm Resilience Centre. How would you respond to these issues.

    I have reblogged your blog on my site, as I think its messages should definitely be spread more widely. I am also concerned with the issue of consumerist wealth for the sake of it. I have recently seen the story of stuff, which opened my eyes! At the moment, I am thinking about frugal living because I don’t believe we understand the difference between need and want any more. Again I have blogged on this issue if you are interested.

    I will follow this blog with interest.

    • April 4, 2014 1:54 pm

      Thanks Rantingsphere. I agree, point 14 needs to be explored a lot more fully. The issue of population isn’t just a question of how much food there is; it’s connected with distribution and exchange and the character of global capitalism. For that reason i’m sceptical about appeals to morality or attempts to change consciousness. I also have my doubts about minor modifications in the behaviour of western consumers. Real progress requires systemic change.

      • April 6, 2014 5:24 pm

        I agree with your concerns about western consumers. I recently did a MOOC called Sustainability, Society and you, where participants came from across the globe. The issues did seemed to be limited to consumers, however, it did not take in to consideration that we are savers and investors. In these roles people can also do more….

        I have recently read a book by Jonathan Porritt called the World We Made by Alex Mckay 2050. It is written from the perspective of Alex – a teacher in 2050 and he is looking back at the past few decades. This includes the good, bad and ugly.

        I look forward to reading future posts.

  85. April 8, 2014 12:05 am

    I’m listening too! You have raised some good points here, good article. May I reblog?

    • April 8, 2014 9:07 am

      Thank you. Yes, of course you may reblog. It’s very polite of you to ask.

  86. April 20, 2014 4:13 pm

    Reblogged this on My Unqualified Opinion and commented:
    Wonderful article on the state of the global poor.

  87. sapphy03 permalink
    April 30, 2014 6:38 pm

    Very insightful points expecially #14. Sharing it on facebook and twitter.

  88. September 3, 2014 7:06 pm

    Thanks Dan. May I print this for distribution to some of the govt. officers, business people and media persons in my town? I’m in North East India btw. Many home truths here and glad to see some sense amid the daily drivel of the interwebs. 🙂

    • September 3, 2014 7:39 pm

      Yes, by all means. Glad you liked it. Your website looks fascinating. Will have a delve around it.

  89. Pat permalink
    September 27, 2014 1:20 pm

    Countries whose leadership organizes for good health care and to reward productivity can’t lose, can they? Living in a world of perpetual industrial revolution is a good thing for societies! Staticism doesn’t win in the long run.

  90. Boitumelo permalink
    January 16, 2015 1:41 am

    Very good read thank you very much i will share with my colleagues. I live and work in Botswana and really to many people in the Western world the picture painted about Africa as the “dark continent” is all they see and now & you can imagine that for someone looking to invest there its not really stimulating. I just want to know what your thoughts are regarding tax evasion by the very big multinational companies who invest in the continent. These cooperations pay very little tax sometimes because of our leaders who are not only corrup but also lack the competence to negotiate economically sound agreements. By this way the outflow of capital from Africa does not even come close to what we get in foreign aid. For instance if the biggest mining company in Zambia would not avoid tax payment, the country’s GDP will double overnight and consequently the government will increase allocation of funds towards social services like health and education.

    • January 16, 2015 11:35 am

      Thanks. I think tax avoidance and evasion are appalling in any country, particularly ones with extreme poverty and poor health and education.

  91. Kay permalink
    February 10, 2015 11:42 pm

    Whoever wrote this article is an idiot for saying that waiters are “poor”. Every waiter I know makes BANK- 700- 1000 a week is NOT poor. Get your facts straight!

    • February 11, 2015 10:04 am

      Kay, thank you for exposing my idiocy. You are a genius in the use of empiricist induction. Hume would be proud. It’s DEFINITELY the case that because every waiter you know earns 700-1000 a week (shekels? you forgot to say which currency) then every other waiter must take home at least this much. Immediate personal experience is ALWAYS the best method for establishing universal truth. Your profound insight tells me that the waiters i’ve met in countries like Laos, Mongolia, Solomon Islands, Lesotho, South Sudan and Haiti could in fact be members of the global one per cent.

      In fact, why don’t you go into academia (assuming you’re not already a professor of international renown) and teach those idiotic social researchers a thing or two about inference? Why don’t they get their facts straight?

      It’s definitely not a problem that the wealthy extrapolate from their own lives and therefore disconnect themselves from the global poor, so in fact you’ve handily scotched another of my ill-founded assertions. In no way, for example, do Americans have a habit of using their own country as the exclusive reference point for their views about the world.

      I look forward to further enlightenment.

  92. May 31, 2015 10:03 pm

    Why not send trained teachers, medical doctors, provisions to teach people how to grow gardens, and religous faiths to help them help themselves.

  93. Masitise Makhotla permalink
    July 1, 2015 5:34 pm

    I am pleased with the good insight about sickening poverty, and sadly the situation is greatly amplified by imbalanced distribution of resources among the people, hence the notion of the elite rich and and filfthy poor bens is born.

  94. July 15, 2015 1:10 pm

    The average woman in Haiti has almost 5 children! Why should the rest of the world pay for that ignorance? The fact is that the poorest countries are having the most children and multiplying the problem. If you can’t afford food, you should not be having children. Throwing a little rice at these people is doing nothing to change the problems in their countries.

    • July 15, 2015 1:27 pm

      Jon, one of the most robust findings in demography is that development reduces population growth. There’s a discussion about this in the comments above. We should continue to support economic development (‘throwing a few grains of rice’is not a phrase i’d use). Another clear finding from the research is that people don’t have families out of ‘ignorance’ (i’m not sure on what grounds you feel able to accuse Haitian women of ignorance). Larger-than-average families are a rational response to economic circusmtances. After all, Europeans and Americans used to have far more children than they do now.

    • Pat Knoebel permalink
      November 6, 2016 6:34 pm

      Absolutely true.

  95. August 14, 2015 3:39 am

    Reblogged this on soniceking.

  96. Pela permalink
    September 3, 2015 11:55 am

    I wish more Americans understood this (I’m not american btw). It really pisses me off when they complain about america and how bad they have it there when everyone in the world dreams about being them.

  97. October 29, 2015 8:08 pm

    Reblogged this on Lilyth Rebecca Coglan and commented:
    Interesting take a read… ♥

  98. GDMNW permalink
    November 18, 2015 8:33 pm

    Hi Dan,

    Just wanted to say thanks for this interesting and enduring piece of journalism.

  99. From Sri lanka( a third world country) permalink
    December 11, 2015 2:45 pm

    This will never ever changed. Whatever you do there will be poor countries.What can I say is just be happy that you born as a human not as an animal 🙂

    • December 11, 2015 11:52 pm

      But many countries have become much richer, especially in the last 50 years. Poverty reduction has been enormous in the last century and people have escaped poverty at a faster rate than ever in recent years with the growth of the Chinese economy. So your fatalism is quite misplaced.

  100. Rahul permalink
    January 4, 2016 4:42 pm

    You make it look like it is completely the rich countries fault particularly west and Europe that poor countries are poor, How have India, China, Singapore, Russia managed to improve their economy, why can’t Africans do same thing? India was heavily exploited under British rule, but after gaining independence we recovered quickly. But the africas are just not meant to live in complex societies, they should be left in peace and allowed to go back to the tribal way of life that they are comfortable with

  101. ananya permalink
    March 11, 2016 8:35 am

    Check your facts before writing, you stupid person! 69% of Indians don’t live under 2 dollars. It may be around 25 percent,I.e. those under Below poverty line. The starting salary for lowest level government employees is around 2000 dollars (not PPP).

  102. March 16, 2016 12:28 am

    good points on this it really help me learned more about poor countries

  103. Henry permalink
    September 18, 2016 3:03 am

    You’ve got some very interesting points. It’s too easy to take for granted such things as shelter food clothing and medicine, even education.
    It would be ideal to focus on being content and having postive lives, but capitalism and being “wage-slaves” is very much a culture. There really is no guiding force, you are churned out systematiclaly and kind of just chase the money, without thinking. There’s not much you can do sometimes.

  104. Claudius permalink
    September 18, 2016 11:48 am

    awesome

  105. onyango fred permalink
    November 13, 2016 4:31 pm

    I have been grately inspired by your article, me as an economist, i know what iit means to adesss the isue concerning poverty, i liked the point you sighted of some false and foreign economicst who spend alot years and years just formulating a complicated models of which some the gresults, they just copy and paste.But when given time to explain them,they can not. what they will tell you is to take the model as a gospel truth, yet our resources is either getting depleted or smome not even been taped.i wish some of them can read your aticle and review their way of handling things, i think our countrmies more especially in africa would reach a nother step in delopment. thanks

  106. Andrew permalink
    December 26, 2016 7:25 pm

    Brilliant!

  107. Joe Wilder permalink
    March 27, 2017 7:48 am

    Great article to remind us of how biased we are in our thinking regarding poverty. If an individual has not lived in poor conditions for any length of time, he or she cannot imagine how tough it is to be poor, with “no way out.”

  108. emma watson permalink
    May 6, 2017 7:41 am

    nice

  109. August 22, 2017 6:30 pm

    This is where blockchain technology and political reform in rich nations can come together to work on a solution. Bitcoin won’t do it because of the distribution and fees; at this time. A distribution of wealth needs to occur. As you stated, “$75,000USD is enough…” to be happy. Use a distribution blockchain to spread the wealth equally to wallets (I won’t go to deep here, just hinting at a monetary solution that requires no donations or charities), since most impoverished will still have access to internet through phones.

    A shifted economic paradigm is almost a pipe-dream, but we are getting closer to realizing the fallacies of our legacy fiat with the rise of cryptocurrencies. While I advocate the use, we need to improve the structure. Fees in any currency are more than most in oppressed economic countries can afford, which must be addressed.

    Grants vs. loans: Smart. Money provides opportunity, if spent on needs first.

    Well written, article.

  110. Macson permalink
    October 18, 2017 4:50 pm

    If you told 14. to climate researchers they’d shake their heads. Global warming is currently the biggest threat to push more people into poverty due to lenghtened droughts, destructive storms, decreased fisheries and whatnot.

    • October 18, 2017 5:39 pm

      Your two statements have nothing to do with each other. No, climate researchers don’t unanimously think that the world is overpopulated (by the way most of them, by definition, study the climate, not population). And of course global warming (researchers prefer the term climate change) is a major cause of poverty. You could quite easily have a growing population and an unrelated process of worsening climate-induced poverty.

      You’re wrong to suggest that climate change is the ‘biggest threat to push more people into poverty’ (sic). There are a number of other reasons why more people might be pushed into poverty, mostly deriving from the way the world economy works.

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