Advanced Search
MyIDEAS: Login to save this paper or follow this series

The Emerging Middle Class in Developing Countries

Contents:

Author Info

  • Homi Kharas
Registered author(s):

    Abstract

    The shift in global goods production towards Asia is well documented. But global consumer demand has so far been concentrated in the rich economies of the OECD. Will that also shift towards Asia as these countries get richer? This paper defines a global middle class as all those living in households with daily per capita incomes of between USD10 and USD100 in PPP terms. By combining household survey data with growth projections for 145 countries, it shows that Asia accounts for less than one-quarter of today’s middle class. By 2020, that share could double. More than half the world’s middle class could be in Asia and Asian consumers could account for over 40 per cent of global middle class consumption. This is because a large mass of Asian households have incomes today that position them just below the global middle class threshold and so increasingly large numbers of Asians are expected to become middle class in the next ten years. The paper explores how this can help sustain global growth in the medium term, driven by product differentiation, branding and marketing in the new growth markets of Asia. La répartition mondiale de la production industrielle en faveur de l’Asie est un phénomène largement démontré. Quant à la demande de consommation mondiale, elle provenait jusqu’ici des économies riches des pays de l’OCDE. Au fur et à mesure que les pays d’Asie s’enrichissent, cette demande de consommation va-t-elle à son tour se déplacer en leur faveur ? Dans ce document de travail, la classe moyenne est définie comme foyers à revenus moyens par tête entre USD10 et USD100, en termes de pouvoir d’achat. En associant des données récoltées lors d’enquêtes auprès de ménages à des projections de croissance dans 145 pays, on s’aperçoit que l’Asie représente moins d’un quart de la classe moyenne d’aujourd’hui. Cette proportion pourrait doubler d’ici 2020. Plus de la moitié de la classe moyenne mondiale se situerait alors en Asie, et les consommateurs asiatiques pourraient représenter plus de 40 pour cent de la consommation mondiale des classes moyennes. Cela est dû au fait qu’un grand nombre de foyers asiatiques perçoive aujourd’hui des revenus les positionnant juste en dessous du seuil de la classe moyenne mondiale. Pour cette raison, il est prévu que, dans les dix prochaines années, de plus en plus d’Asiatiques fassent partie de la classe moyenne. Ce document de travail analyse la manière dont ce phénomène peut contribuer à maintenir, au moyen terme, la croissance globale, qui est provoquée par la différentiation des produits, le marquage et le marketing dans les nouveaux marchés émergents d’Asie.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://dx.doi.org/10.1787/5kmmp8lncrns-en
    Download Restriction: no

    Bibliographic Info

    Paper provided by OECD Publishing in its series OECD Development Centre Working Papers with number 285.

    as in new window
    Length:
    Date of creation: 26 Jan 2010
    Date of revision:
    Handle: RePEc:oec:devaaa:285-en

    Contact details of provider:
    Postal: 2 rue Andre Pascal, 75775 Paris Cedex 16
    Phone: 33-(0)-1-45 24 82 00
    Fax: 33-(0)-1-45 24 85 00
    Email:
    Web page: http://www.oecd.org/Dev
    More information through EDIRC

    Related research

    Keywords: Chile; firm level data; classe moyenne; pays asiatiques; croissance globale; centre de gravité; consommation;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. Sinha, Piyush Kumar & Gokhale, Srikant & Rawal, Saurabh, . "Online Retailing Paired with Kirana – A Formidable Combination for emerging Markets," IIMA Working Papers WP2014-02-09, Indian Institute of Management Ahmedabad, Research and Publication Department.
    2. Francisco H.G. Ferreira & Julian Messina & Jamele Rigolini & Luis-Felipe López-Calva & Maria Ana Lugo & Renos Vakis, 2013. "Economic Mobility and the Rise of the Latin American Middle Class," World Bank Publications, The World Bank, number 11858, August.
    3. Eduardo Lora & Francesca Castellani, 2014. "Entrepreneurship in Latin America : A Step Up the Social Ladder?," World Bank Publications, The World Bank, number 16347, August.
    4. Cameron Hepburn & Alex Bowen, 2012. "Prosperity with growth: Economic growth, climate change and environmental limits," Grantham Research Institute on Climate Change and the Environment Working Papers, Grantham Research Institute on Climate Change and the Environment 93, Grantham Research Institute on Climate Change and the Environment.
    5. Peter Edward & Andy Sumner, 2014. "The Poor, the Prosperous and the ?Inbetweeners?: A Fresh Perspective on Global Society, Inequality and Growth," Working Papers 122, International Policy Centre for Inclusive Growth.
    6. Christian MORRISSON & Fabrice MURTIN, 2011. "L’inégalité de revenu moyen entre pays (1700-2030)," Working Papers, FERDI P25, FERDI.
    7. Simon Baptist & Cameron Hepburn, 2012. "Intermediate inputs and economic productivity," Grantham Research Institute on Climate Change and the Environment Working Papers, Grantham Research Institute on Climate Change and the Environment 95, Grantham Research Institute on Climate Change and the Environment.
    8. Loayza, Norman & Rigolini, Jamele & Llorente, Gonzalo, 2012. "Do middle classes bring about institutional reforms?," Economics Letters, Elsevier, Elsevier, vol. 116(3), pages 440-444.
    9. Syetarn Hansakul, 2010. "Understanding China’s Consumers," Working Papers id:3014, eSocialSciences.
    10. Christian MORRISSON & Fabrice MURTIN, 2011. "Average income inequality between countries (1700-2030)," Working Papers, FERDI P25, FERDI.
    11. Zhang Yuan & Guanghua Wan & Niny Khor, 2012. "The rise of middle class in rural China," China Agricultural Economic Review, Emerald Group Publishing, Emerald Group Publishing, vol. 4(1), pages 36-51, February.
    12. Edward, Peter & Sumner, Andy, 2014. "Estimating the Scale and Geography of Global Poverty Now and in the Future: How Much Difference Do Method and Assumptions Make?," World Development, Elsevier, Elsevier, vol. 58(C), pages 67-82.
    13. Xavier Ordeñana & Ramon Villa, 2012. "Mobility and Entrepreneurship in Ecuador: A Pseudo-Panel Approach," Research Department Publications, Inter-American Development Bank, Research Department 4783, Inter-American Development Bank, Research Department.
    14. Inter-American Development Bank (IDB), . "Entrepreneurship in Latin America: A Step Up the Social Ladder?," IDB Publications 84533, Inter-American Development Bank.
    15. Birdsall, Nancy & Lustig, Nora & Meyer, Christian J., 2014. "The Strugglers: The New Poor in Latin America?," World Development, Elsevier, Elsevier, vol. 60(C), pages 132-146.

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:oec:devaaa:285-en. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.