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Oct 22, 2013

How to Fight Global Poverty

Have you heard the news? The number of people living in abject poverty—defined as living on less than $1.25 per day—has been halved since 1990. How did that happen? Prof. Stephen Davies explains that extreme poverty has been on the decline in part because two of the world’s most populous countries, China and India, have embarked on a path of economic liberalization and development over the past two to three decades. As more countries have embraced free trade and market-friendly policies, we have seen encouraging news of poverty reductions and greater access to clean drinking water. If such policies continue, Prof. Davies says, it’s not out of the question for extreme poverty to be eradicated in the foreseeable future. These gains are likely to be lost, however, if we make poor economic decisions that take us back toward protectionism and economic controls. With good economic policies and free markets, we can help many of the poorest people in the world. 

Sources:
1.) The statement that the number of people living on less than $1.25/day was halved between 1990 and 2010 can be found on Page 4 of this report (not the PDF numbering):http://www.un.org/millenniumgoals/pdf… 

2.) Statement about # of those without access to clean drinking water being halved is found on Page 52 of the 2012 report:http://mdgs.un.org/unsd/mdg/Resources… 

3.) This statement, “In India, in 1990, 51% of the population lived in absolute poverty. By 2015, the proportion will have fallen to 22%.”: http://articles.timesofindia.indiatim…

4.) The statement about the percentage consuming less than $1 a day was 65% in 1981, and 10% in 2004. It’s also cited that it is estimated that China’s figures will drop from 65% to 4%: (Pages iii and iv of the World Bank report): http://www-wds.worldbank.org/external… 

5.) This data takes into account “purchasing power parity.” The $1.25 a day is in 2005 dollars, and replaces the previously used measure $1.08 from 1993:http://mdgs.un.org/unsd/mdg/Metadata….