IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

The Buoyant Billions: How “Middle Class” Are the New Middle Classes in Developing Countries? (And Why Does It Matter?)

  • Andy Sumner
Registered author(s):

    Middle-income countries (MICs) are now home to most of the world’s extreme poor—the billion people living on less than $1.25 a day and a further billion people living on between $1.25 and $2. At the same time, many MICs are also home to a drastically expanding emerging middle or nonpolar group, called here the “buoyant billions.” This group includes those (mostly in MICs) living on between $2 and $4 a day and another billion people (also mostly in MICs) between $4 and $10 a day. Although they are above the average poverty line for developing countries, many people in these new “middle classes” may be insecure and at risk of falling into poverty. This paper outlines indicative data on trends relating to poverty and the nonpoor by different expenditure groups, and critically reviews the recent literature that contentiously labels such groups as “middle class.” The paper argues that such groups are neither extremely poor nor secure from poverty and that such groups are worthy of closer examination because their expansion may potentially have wider societal implications related, for example, to taxation, governance, and—ultimately—domestic politics

    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://www.cgdev.org/files/1426628_file_Sumner_Buoyant_Billions_FINAL.pdf
    Download Restriction: no

    Paper provided by Center for Global Development in its series Working Papers with number 309.

    as
    in new window

    Length: 20 pages
    Date of creation: Oct 2012
    Date of revision:
    Handle: RePEc:cgd:wpaper:309
    Contact details of provider: Web page: http://www.cgdev.org

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Benno Torgler, 2003. "Tax Morale in Latin America," Working papers 2003/03, Faculty of Business and Economics - University of Basel.
    2. Easterly, William, 2000. "the middle class consensus and economic development," Policy Research Working Paper Series 2346, The World Bank.
    3. Palma, J.G., 2011. "Homogeneous middles vs. heterogeneous tails, and the end of the ‘Inverted-U’: the share of the rich is what it's all about," Cambridge Working Papers in Economics 1111, Faculty of Economics, University of Cambridge.
    4. Alesina, Alberto & Perotti, Roberto, 1996. "Income distribution, political instability, and investment," European Economic Review, Elsevier, vol. 40(6), pages 1203-1228, June.
    5. Alberto Alesina & George-Marios Angeletos, 2005. "Fairness and Redistribution," American Economic Review, American Economic Association, vol. 95(4), pages 960-980, September.
    6. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October.
    7. Ravallion Martin, 2010. "Do Poorer Countries Have Less Capacity for Redistribution?," Journal of Globalization and Development, De Gruyter, vol. 1(2), pages 1-31, December.
    8. Acemoglu, Daron & Zilibotti, Fabrizio, 1996. "Was Prometheus Unbound by Chance? Risk, Diversification and Growth," CEPR Discussion Papers 1426, C.E.P.R. Discussion Papers.
    9. Doepke, Matthias & Zilibotti, Fabrizio, 2007. "Occupational Choice and the Spirit of Capitalism," CEPR Discussion Papers 6405, C.E.P.R. Discussion Papers.
    10. Sergei Suarez Dillon Soares & Rafael Guerreiro Osório & Fabio Veras Soares & Marcelo Medeiros & Eduardo Zepeda, 2007. "Conditional Cash Transfers in Brazil, Chile and Mexico: Impacts upon Inequality," Working Papers 35, International Policy Centre for Inclusive Growth.
    11. Thomas Piketty, 1994. "Social Mobility and Redistributive Politics," Working papers 94-15, Massachusetts Institute of Technology (MIT), Department of Economics.
    12. Perotti, Roberto & Alesina, Alberto, 1996. "Income Distribution, Political Instability, and Investment," Scholarly Articles 4553018, Harvard University Department of Economics.
    13. Birdsall, Nancy, 2007. "The macroeconomic foundations of inclusive middle-class growth :," 2020 vision briefs BB12 Special Edition, International Food Policy Research Institute (IFPRI).
    14. Francisco Panizza, 2005. "Unarmed Utopia Revisited: The Resurgence of Left-of-Centre Politics in Latin America," Political Studies, Political Studies Association, vol. 53, pages 716-734, December.
    15. Nancy Birdsall & Nora Lustig & Darryl McLeod, 2011. "Declining Inequality in Latin America: Some Economics, Some Politics," Working Papers 1120, Tulane University, Department of Economics.
    16. Barro, Robert J., 1999. "Determinants of Democracy," Scholarly Articles 3451297, Harvard University Department of Economics.
    17. Anthony B. Atkinson & Andrea Brandolini, 2011. "On the identification of the “middle class”," Working Papers 217, ECINEQ, Society for the Study of Economic Inequality.
    18. John Harriss, 2009. "Drivers of development over the next 30 years: Some speculations," Journal of International Development, John Wiley & Sons, Ltd., vol. 21(6), pages 772-775.
    19. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1989. "Industrialization and the Big Push," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1003-26, October.
    20. Senauer, Benjamin & Goetz, Linde, 2003. "The Growing Middle Class In Developing Countries And The Market For High-Value Food Products," Working Papers 14331, University of Minnesota, The Food Industry Center.
    21. Pritchett, Lant & Suryahadi, Asep & Sumarto, Sudarno, 2000. "Quantifying vulnerability to poverty - a proposed measure, applied to Indonesia," Policy Research Working Paper Series 2437, The World Bank.
    22. Alberto F. Alesina & Paola Giuliano, 2009. "Preferences for Redistribution," NBER Working Papers 14825, National Bureau of Economic Research, Inc.
    23. Chun, Natalie, 2010. "Middle Class Size in the Past, Present, and Future: A Description of Trends in Asia," ADB Economics Working Paper Series 217, Asian Development Bank.
    24. Esther Duflo & Abhijit Banerjee, 2008. "What is Middle Class About the Middle Classes Around the World?," Working Papers id:1363, eSocialSciences.
    25. Loayza, Norman & Rigolini, Jamele & Llorente, Gonzalo, 2012. "Do Middle Classes Bring Institutional Reforms?," IZA Discussion Papers 6430, Institute for the Study of Labor (IZA).
    26. Christian Daude & Ángel Melguizo, 2010. "Taxation and More Representation?: On Fiscal Policy, Social Mobility and Democracy in Latin America," OECD Development Centre Working Papers 294, OECD Publishing.
    27. Marcelo Medeiros, 2006. "The Rich and the Poor: The Construction of an Affluence Line from the Poverty Line," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 78(1), pages 1-18, 08.
    28. Luis López-Calva & Eduardo Ortiz-Juarez, 2014. "A vulnerability approach to the definition of the middle class," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 12(1), pages 23-47, March.
    29. Alejandro Gaviria, 2007. "Social Mobility and Preferences for Redistribution in Latin America," ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, vol. 0(Fall 2007), pages 55-96, August.
    Full references (including those not matched with items on IDEAS)

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

    When requesting a correction, please mention this item's handle: RePEc:cgd:wpaper:309. 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: (David Roodman)

    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.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.