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The (indispensable) middle class in developing countries; or, the rich and the rest, not the poor and and the rest.
Washington, D.C., Center for Global Development, 2010 Mar.  p. (CGD Working Paper 207)Inclusive growth is widely embraced as the central economic goal for developing countries, but the concept is not well defined in the development economics literature. Since the early 1990s, the focus has been primarily on pro-poor growth, with the “poor” being people living on less than $1 day, or in some regions $2 day. The idea of pro-poor growth emerged in the early 1990s as a counterpoint to a concern with growth alone (measured in per-capita income) and is generally defined as growth which benefits the poor as much or more han the rest of the population. Examples include conditional cash transfers, which target the poor while minimizing the fiscal burden on the public sector, and donors’ emphasizing primary over higher education as an assured way to benefit the poor while investing in long-term growth through increases in human capital. Yet these pro-poor, inclusive policies are not necessarily without tradeoffs in fostering long-run growth. In this paper I argue that the concept of inclusive growth should go beyond the traditional emphasis on the poor (and the rest) and take into account changes in the size and economic command of the group conventionally defined as neither poor nor rich, i.e., the middle class.
Economic Development and Cultural Change. 1982 Apr; 30(3):649-70.This essay argues that the drive toward a middle class style of life in developing countries has resulted over the past 30-odd years of conscious development effort in a series of negative consequences in diverse spheres: persistence of inequality, expansion of government, neglect of agriculture, and urban bias of education and research. The class context of development, the role of the middle class, the characteristics and components of the middle class life style, and the American contribution to its development are assessed, after which the methodology and results of measuring the poor and the middle class in the US and elsewhere are considered. Measurement of the middle class can be attempted through ownership of articles such as automobiles, through energy consumption, or through income: one estimate is that the global middle class increased from 200 million in 1950 to 800 million by 1980 through the addition of Japan, Europe, and some increase in the 3rd world. The nature of middle class work and the consequences of the preference for middle class work on the part of national elites for local development efforts is described, along with the related theme of the conflict between alleviation of poverty and development of an indigenous middle class in 3rd world countries. China and Brazil are viewed as the 2 extremes in this trade-off. The incentives to massive urban migration that occur in conjunction with development policies favoring the middle class are outlined. Finally, it is argued that reaching for middle class status is an explanatory rather than a policy variable. The social mechanisms that cause the spread of the middle class to take precedence over the alleviation of poverty need to be more closely examined.