Has poverty worldwide dropped dramatically?

That may seem like a simple question to answer, but it has become the subject of fierce discussions between developers, economists and scientists.

The dispute all started with this graph:

Global poverty from 1820 to 2015

Our world in data

Produced by Our World in Data – a non-profit website funded by Gates Foundation led by economist Max Roser who emphasizes long-term trends in human living standards – the map shows the extreme poverty rate, measured as the share of humanity at $ 1, 90 per day or less, plummeting from 94.4 percent in 1820 to 9.6 percent in 2015. As Roser quickly points out, it is not "his" chart – it's similar to graphs that many economists working on poverty have produced, such as one in Georgetown Professor Martin Ravallion's book The Economics of Poverty.

The graph tells a story of enormous global progress, a story that I also promoted in my own writing.

But after Bill Gates tweeted the chart and others from Our World in Data, …

… anthropologist Jason Hickel stood up to say: not so fast. In a Guardian article with the title: "Bill Gates says poverty is declining, he can not be wrong anymore," Hickel raises a number of objections to the graph:

  1. The $ 1.90-per-day line is "obscene low" and "earning $ 2 a day does not mean you're suddenly free of extreme poverty." A minimum of $ 7.40 per day, at least, is required for "basic" nutrition and normal life expectancy of humans. "
  2. Using the percentage of people in poverty is misleading and we should instead focus on the absolute number people in poverty who, according to Hickel's preference, have $ 7.40 per day increased since 1981.
  3. All figures before 1981, when the World Bank began collecting detailed survey data on poverty, are illegal: "Everything is very vague and going back to 1820 is pointless." Roser bases himself on a dataset that was never intended to reduce poverty. but rather inequality in the distribution of GDP in the world – for only a limited number of countries. "
  4. The graph knew the toll of colonialism, especially in the period 1820 to 1981. "The world went from a situation where the majority of humanity did not need any money at all, where the majority of mankind nowadays struggles to survive with extremely small amounts of money ", writes Hickel. "The graph raises this as a fall in poverty, but in reality there was a process of expropriation that brought people to the capitalist labor system, during housing movements in Europe and the colonization of the global south."
  5. With regard to point 4, it is not clear that a transition from a pre-monetary society to a monetary society – even if that monetary society greatly reduces monetary poverty – means an improvement in living standards, especially when that transition largely occurred because of violence and coercion by Western powers.
  6. "Almost all" the reduction of extreme poverty occurred in China, which supported extensive state support for industry and exports. "It is therefore unfair for people like Gates and [Steven] Pinker to claim these wins as victories for neoliberalism in Washington consensus, "writes Hickel.

There followed a broad interaction with Harvard's psychologist (and a convinced proponent of a worldwide progress story). Steven Pinker responded to Hickel, Hickel shot back, Joe Hassell and Max Roser on Our World in Data defended their methodology, Hickel doubled his criticism and Branko Milanovic, a CUNY economist and demonstrably the dean of worldwide inequality studies, who are also getting off the ground.

But in the course of the debate, the positions of the two parties seemed, at least for me, to converge considerably. Everyone agrees that since 1981 the incomes of the poorest people in the world have increased – even for Hickel denied his Guardian head, saying that it was forced upon him by editors. Everyone agrees that incomes for the poor have not risen enoughand that $ 1.90 per day is hardly sufficient for a person to live a decent life.

The big differences are therefore how these facts can be split up and interpreted, and what political interests and stories they serve. Hickel argues that focusing on data demonstrating the deterioration of world poverty is doing political work for the benefit of global capitalism, and defends an inherently unjust global system that has failed both residents of poor and poor countries. Pinker agrees that the data support the idea that capitalism works for the world's poorest, and says that this is a decisive refutation of Hickel's story of continued persecution.

Roser, as he repeatedly emphasized in messages to me, simply wants to be clear about what the facts say – and what they say definitively is that the living conditions of the world order have been improved for decades and decades. Based on my reading of the evidence, that is certainly true.

Let's start with the things that everyone agrees on

This debate can get incredibly hot (and frankly, because the stakes are incredibly high), so it was useful last year that Hickel and Charles Kenny – whose book Better makes a convincing argument that the world is getting better – compile a list of 12 statements about which they can both agree.

Among them (and I quote directly here, because I am sure that they have negotiated considerably to come to):

  • "The $ 1.90 / day (2011 PPS) line is not a satisfactory or in any way satisfactory level of consumption, it is explicitly an extreme measure, and some analysts suggest that about $ 7.40 / day is the minimum required to Good nutrition and a normal life expectancy, while others say we use the American poverty line, which is $ 15. "
  • "The proportion of people living below $ 1.90 per day has decreased significantly, but poverty as measured by $ 7.40 / day has fallen more slowly, from 70.8 percent in 1981 to 58.1 percent in 2013."
  • "The average use of people under both the $ 1.90 and the $ 7.40 poverty line and above has increased and the & # 39; poverty gap & # 39; (the average distance below the poverty line) has become smaller. & # 39;
  • "Income and consumption do not tell us the whole story about poverty, poverty is multidimensional and some aspects of human welfare can be obscured by consumption figures."
  • "The current rate of poverty reduction is too slow for us to put an end to $ 1.90 / day of poverty by 2030, or $ 7.40 / day of poverty in our lives." To achieve this goal, we would economic policy to make it fairer for the majority of the world. & # 39;

So the share of humanity in extreme poverty – measured at a $ 1.90 per day or $ 7.40 line – is falling. People under both lines also do better in terms of poverty; they have more money, spend more, etc. But there is more to life than measurable consumption, ending $ 7.40 per day. Poverty will last for many decades and there is more that we can do to speed up that process.

Although not included in Hickel-Kenny's consensus document, I would note that Hickel agrees with Gates, Pinker, Roser, etc. that some material living standards beyond poverty and consumption have improved over the past decades. According to the numbers of the UN population division (of course compiled by Our World in Data), life expectancy in China rose from just 43 years in 1950 to 76 in 2015 (in fact handy for none other than the politics of Bob Avakian, it even grew Mao killed tens of millions of people). India's life expectancy grew from 35 to 68 in the same period; in the Democratic Republic of Congo it grew from 38 to 59. Likewise, the figures on literacy and the number of years of education have increased.

"Yes, of course I agree that life expectancy has increased and infant mortality has decreased," Hickel wrote in an e-mail to me. "These data are not controversial, although I am different from Gates and Pinker when I assess the causes of those improvements … Regarding the graphs on literacy and years of training: the data is correct, but I believe that this is very narrow indicators are of education and that a broader, more holistic view reveals a more complicated story. "

In his letter to Steven Pinker, Hickel agrees that life expectancy and education have increased. "In your work you have made a profit in life expectancy and education as part of a story that tries to justify neoliberal globalization," Hickel writes. "But … that is intellectually dishonest." What contributes most to the improvement of life expectancy is in fact simple interventions in the field of public health (sanitation, antibiotics, vaccines) and what is important for education, is good public education. & # 39;

So while there are clearly noisy differences about what political story the facts about life expectancy and educational support are, everyone seems to agree that the world has made significant progress in both areas.

That is the point where the agreement stops.

Poverty line and absolute numbers

Let's start with Hickel's criticism of the Roser chart. Roser relies on survey data from the World Bank that Hickel himself admits, is in principle reliable, some disagreements about purchasing power adjustments aside. Hickel emphasizes that the poverty threshold of $ 1.90 per day is unacceptably low, and that we must concentrate on absolute numbers – how many total people live in poverty – as well as the proportion of people in extreme poverty.

Hickel is on solid ground in raising a higher poverty line. Many development economists think that a more useful rule would be higher, perhaps much higher – Kenny and economist Lant Pritchett have quarreled at several places for a line of $ 10-15 per day, much closer to the US poverty line (about $ 17.60 per day). person per day for a family of four). Kenny is clear that he does not think this idea has the support of the scientific consensus & # 39; which Hickel claims to have, but no one claims that $ 1.90 per day per person is enough for a decent existence. We can and must aim for more.

The problem comes when Hickel claims that increasing the poverty line dramatically changes our image of what is happening. It is true that the number of people living on less than $ 7.40 per day declined less quickly than the number of people living below $ 1.90 per day, but what we are told above all is that there is a large group of insanely poor people who lived, say, 50 cents a day, who have climbed in recent decades to earn $ 2.50 a day for example.

That is not enough for the imagination and they deserve more help. But that is real progress that deliberately excludes a higher poverty line – just as a lower poverty line excludes people who go from $ 2.50 per day to $ 4.50 per day, who also see a dramatic improvement in their quality of life.

The most important thing is not so much the line as the distribution: are the poorest people in the world generally earning more money? And the answer to the latter is yes, yes they are, as Hickel himself admits.

This chart from a 2013 paper by Shaohua Chen, the leading developmentist at the World Bank, and Martin Ravallion requires some unpacking, but illustrates the point:

Global poverty under various poverty lines from 1981 to 2008

Chen and Ravallion 2013

(Thanks to Ryan Briggs for the pointer.)

The X axis represents several hypothetical poverty thresholds: $ 1.90 per day, $ 7.40 per day, all the way up to $ 13 per day, or roughly the US rule for a family of four. Then the Y-axis tells us what percentage of humanity lived below that poverty line in a given year. The blue line shows the distribution for 1981, the black line for 2008; let's just compare those two to keep things simple.

Obviously, a poverty line of $ 0 has no one living underneath. And a poverty level of $ 1 billion a day would ensure that everyone lives underneath. But what this graph shows is that for each poverty line between $ 0 and $ 13 per day, and possibly even above it, poverty was lower in 2008 than in 1981. That was not true if you compared 1999 with 1981; all progress between those years was on the very low side, so $ 6 or $ 7 per day of poverty was not reduced. But we have reduced poverty from 1981 to 2008 with basically any threshold you could possibly use.

This does not answer the question which line of scientific staff should use. I'm not as furious as Hickel is by using the $ 1.90-per-day rule, because I think it shows a part of a broader story that goes for every poverty line you choose. But I would personally like to change to $ 7.40 per day, which would show that something similar happens.

On absolute numbers I fear that Hickel has a weaker case. Hickel likes to note that although the number of people living below $ 7.40 per day has dropped from 1981 to now, the number of people living underneath has increased.

"If the goal is to end poverty, it is about absolute numbers", writes Hickel. "Certainly that is what is important from the perspective of poor people themselves."

This is the same reason why figures such as Hickel & # 39; s sworn enemy Bill Gates are concerned about population growth in poor countries. But I think Gates is wrong, and that's Hickel too. Another way of saying "the poverty rates fell while the absolute number of poor people increased" is that many middle-income countries, with many people between $ 1.90 per day and $ 7.40 day, saw their population grow. There are now more Indians, more Indonesians, more Nigerians, more Kenyans.

That is not a bad thing. The use of absolute numbers entails confusion of poverty alleviation prevent poor people from living. The latter is a much stranger and frankly more worrying goal. The history of Western countries trying to intervene in population growth in developing countries is extremely ugly, full of forced sterilization and other human rights violations. Part of the reason why the population has increased is also due to a thorough improvement of health and food supply, such as the green revolution, the eradication of smallpox, malaria beds etc. The success of that policy is real proof that poverty has increased?

More conceptually, it is not really logical to interpret the choice of a poor woman in India to have another child as & # 39; increasing poverty & # 39 ;. What most people in the development field want to assure is that the people who do exist, however many of them there are, may be as good as possible. The use of percentages is a better approach, although even percentages can be influenced by the effects of population growth if fertility in poor countries significantly exceeds fertility in rich countries.

When I addressed Hickel about this, he insisted – arguing that in a rich world we must assume that everyone born into poverty is a policy failure. "In rich countries such as the UK or the US, we would never say that a growing number of poor people are dealing with reproduction," he wrote in an e-mail. "No, we want to point out that this has to do with the minimum wage that is too low, or weak labor rights, or subprime mortgages, or inflated house prices, or whatever, we identify systemic causes because we know that poverty is in the midst of plenty is not natural, but created, so why should we imagine differently in the global South? "

This feels a bit like an evasion of the question for me. We use poverty, not absolute numbers, also in discussions about poverty in the US. But in some ways, Hickel's answer reflects the core of the dispute between him and Roser. Roser – and most economic historians – do not regard poverty as created, but as the original state of humanity from the beginning to the industrial revolution. It is a policy shortage in that we finally have the tools to end it and have not done it yet, but what we are trying to do is to escape the natural, cruel conditions of humanity. Hickel sees things differently.

The historical data debate

That brings us to the second big dispute: do we have to rely on data about global poverty before 1981?

Hickel and Kenny could agree on the above figures, because they only rely on the survey data from the World Bank, which started in 1981. But the map of Our World in Data, which triggered this entire debate, relies not only on the data from the World Bank, but on a historical dataset dating back to 1820, compiled by economists François Bourguignon and Christian Morrisson; it was published in an article in the American economic magazine 2002 entitled "Inequality between world citizens: 1820-1992."

The songs by Bourguignon and Morrisson are in turn based on work by Angus Maddison, the late British economic historian who, together with his research partners and students, worked for decades to put together a huge database of gross domestic product and GDP per capita. population dates back to AD 1 in the year. ; these figures are still being maintained by other researchers after his death. The first Maddison database dating back to 1820, debuted in 1995.

It is terribly difficult to generate this kind of estimates. In 1820, the national governments did not produce the economic estimates they make today, and usually the income taxes and corporate taxes were missing that would provide them with the data to do such an estimate in a straight-line manner. Neither the GDP figures of Maddison nor the extrapolations of the poverty income of Bourguignon and Morrisson are therefore as reliable as the data from the World Bank.

What Hickel argues is that a diagram that combines data from the World Bank with data from Bourguignon and Morrisson to construct a longer story relies on data that is so weak that they are of no use, and mixes real figures with rough estimates.

Hassell and Roser of Our World in Data argue that the songs Bourguignon and Morrisson are still useful and worthwhile. "I totally agree that we need to understand the limitations of that data," Roser said in a Twitter message. "That's why I do not just make a chart, but I've worked 10 years writing a publication explaining what's behind it, but it's not possible to reduce it to a single number, a single graph or only quotation mark. "

Hassell and Roser provide the example of how historical estimates of Britain's GDP have been constructed. The researchers Stephen Broadberry, Bruce MS Campbell, Alexander Klein, Mark Overton and Bas van Leeuwen, for example, reached their estimate by following dozens of steps with data on individual crops and cattle to find out what the economy of England did in the 1850s. "

Hickel disputes that the richness of the data about England contrasts with a lack of data in a large part of China and Asia. "For Asia and Latin America, there are only data for 1900 for just three countries," he writes. "For Africa there are no data before 1900, and data for 1950 are for only three countries."

Roser argues that this is essentially bickering. We know that the majority of Africa at that time was by other sources in extreme poverty, he says. "We really do not have many reconstructions for Africa", he wrote in a message. "But we have a number, and these do not suggest that people in Africa were much richer than Europeans at that time."… But you can also ask yourself how much the uncertainty for Africa can make for our estimates of world poverty." The population of Africa was 8% of the world's population, even if all Africans were billionaires at the time, this would mean that the poverty rate worldwide would be a maximum of 8% lower. "

Ultimately, this part of the debate is about what to do with incomplete data. Is it acceptable to use a faulty, not globally representative series of figures such as Bourguignon and Morrisson to illustrate the long-term decline of extreme poverty? Or is it unacceptably misleading?

Hickel strongly argues that Roser and Our World in Data must roll back the card dating back to 1820, or at least add a warning about the various data sources. Roser claims that the story telling the chart is accurate, that we know it is accurate because of various sources outside the data of Maddison and Bourguignon and Morrisson, and that Hickel is trying to muddle the waters.

"What is really frustrating is that [Hickel] publicly gives the impression we do not really know, and given everything I said … and economic historians said absolutely nothing in hundreds of amazing research publications, "he wrote me." That's not fair for us, I feel, it's not at all fair for the research that is there, it just gives the readers bad information. The Guardian article that says & # 39; it's all wrong & # 39; sticks around. & # 39;

How do we deal with colonialism?

Hickel's broader view is that what the nineteenth century saw was a process of forced expropriation by colonizing nations, which changed a period of wealth and consolation for defeated indigenous peoples in a predatory capitalism. Instead of the constant progress navy that Hickel mapped, such as Roser's portrait photo's, there was profound violence and disruption, which can hardly be called "escaping poverty". Of course, a Zulu citizen for the British conquest may not have earned a hard currency, but she had a much better quality of life than the imperialists offered her, argues Hickel.

In fact, nobody in this debate does not agree that colonialism was a gruesome, morally indefensible process. "Of course, I agree that colonialism is one of the most horrible institutions the world has ever seen," Roser commented in a Twitter message to me. "Not only, but also because of the terrible impact it had on the development until today, as we know from the studies of economic historians who rely on the data they have produced."

The actual disagreement is therefore more about whether pre-colonial societies can meaningfully be called "in poverty", while monetary poverty was not really a relevant concept.

Roser insists that we can. "We know about poverty in the past not only of the reconstructions of consumption or income measures, but also the reality check of how the living conditions were broader (health, mortality, technological evidence, agriculture, food intake, housing etc.)," ​​Roser wrote me. "There is no evidence that Africa or elsewhere was significantly richer than the UK."

But Hickel disputes this image of precolonial societies as "arm & # 39; In his book The chasm, he argues that precolonial agricultural societies in Africa and India were "very satisfied" with a "living lifestyle." In Africa, for example, he writes that "most people had access to the land where their cattle graze and food for their families to grow." They did not see why they had to leave their homes for the reversal of labor on plantations and mines. . "Also, before the British forced a new farming system, Hickel writes that Indian farmers accumulated crops for" maintenance, "and were greatly reduced, when the British colonial authorities imposed a new system on them.

Again, it is undeniable that colonialism has made conditions on the ground worse. But that does not mean that precolonial living conditions were good. The agrarian revolution, which took place in Africa, India, America and Europe, reduced food security and increased material need, according to many anthropologists. Until the industrial revolution made real, sustainable economic growth possible, the majority of mankind was stuck in a Malthusian trap, just as Europe had begun the industrial revolution, in which economic growth and poverty alleviation only led to a population growth that could not be achieved. supported, leading to starvation. And, again, life expectancy was much lower, and literacy was much less common.

If Hickel argues that $ 1.90 per day is too low a threshold to curb poverty, I would object to a definition of poverty that does not take into account Malthusian conditions before industrialization is inadequate. The conditions were not great – even if everyone admits that Europe has argued a century or more ago to hurt his life in order to make his victims worse.

Global poverty from 1820 to 2015

Our world in data

And indeed, if you look again at the graph that opens this post, you will see that extreme poverty fell by very, very low amounts throughout the 1950s, gains concentrated in rich European countries that flourished in withdrawing resources from the global South.

This corresponds with the story of Roser: all of humanity was poor, excluded from breaking bare maintenance to industrialization; colonization prevented the mass of mankind from benefiting from the economic growth that made industrialization possible in Europe and North America, and considerably worsened conditions for the victims; but global growth since 1950 led to massive poverty alleviation.

The political commitment

"One thing that really frustrates me is that I get assigned positions that I do not have," Roser wrote me. Our world in data not only shows positive developments; it also shows how the inequality in the nations has increased and how climate change has accelerated, in addition to other negative trends. Roser agrees that we are not moving fast enough to end poverty. He is not opposed to health and education programs from the government – he does indeed use evidence that shows how well they have worked!

But Hickel and Pinker are not only interested in the detailed disputes above. They are fighting for a story. Hickel considers Pinker and Gates as defenders of a neoliberal capitalist world order, where countries are urged to get rid of important safety net programs and take de-regulatory policies that can devastate their citizens. Worse still, by citing data dating back to 1820, he sees them as whitening the violence of colonialism, using recent world history as a story of non-stop progress.

Pinker described Hickel as "a Marxist ideologist made possible by the Guardian" and added: "The political agenda of Hickel and other extreme left parties is obvious: it is humiliating for their worldview that the data to see enormous improvements as a result of markets and globalization instead of overthrowing capitalism and global redistribution. "To which Hickel of course refutes the greatest gains were seen in China, almost no idea of ​​a pure capitalist society.

This perceived political commitment is the main reason why this fight has become so hot. But if we do narrow about the actual numbers agreed by people in the debate, there is less disagreement than one might think. Almost everyone agrees that life expectancy is higher, that education is more common and that poverty has declined in the last three or four decades, regardless of where you defined the poverty line. And just about everyone agrees that we have to go much further.

I think that the fundamental fact that we have made progress over the past decades is important. Politics and the global economy are gloomy places, especially if you only see them through the lens of the news coverage. It is easy to become fatalistic. What I take of progress against extreme deprivation and poverty is not a feeling that the mission is accomplished, or that Friedrich Hayek was Never Wrong, but a feeling that things can be betterand trying that is not hopeless. I hope that both Hickel, Roser and Pinker agree on this.


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