November 4, 2014

Global Poverty Index Shows Significant Improvement

Between 1990 and 2011, extreme poverty fell 21% globally, according to the World Bank, from 36% to 15%. That’s a statistic to be celebrated, but economists don’t appear to be taking much notice, which likely has something to do with the chief benefactor. “Official organizations noting the trend have tended to waffle,” writes Dartmouth College professor Douglas Irwin, “but let’s be blunt: The credit goes to the spread of capitalism. Over the past few decades, developing countries have embraced economic-policy reforms that have cleared the way for private enterprise.” China and India are among the countries at the forefront of free enterprise-friendly endeavors, and other nations like Colombia, Vietnam and Africa are following suit. Adds Iwin, “The reduction in world poverty has attracted little attention because it runs against the narrative pushed by those hostile to capitalism. The Michael Moores of the world portray capitalism as a degrading system in which the rich get richer and the poor get poorer. Yet thanks to growth in the developing world, world-wide income inequality – measured across countries and individual people – is falling, not rising.” More…

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