Our World in Data is a project that aims to give ‘research and data to progress against the world’s most pressing challenges.’ Only if it is feasible to achieve progress in the face of the world’s greatest issues does our goal make sense. Few people believe the world is improving. ‘All things considered, do you think the world is growing better or worse, or neither better nor worse?’ questioned a 2015 poll. Only 10% of Swedes believed things were getting better, compared to only 6% in the US and 4% in Germany.
What evidence should we take into account while addressing this question? The question is how the world has evolved, which is why we need to look at it from a historical standpoint. And because the subject concerns the entire planet, the answer must take everyone into account. The solution must take into account the history of global living circumstances, as well as the history of everything. Poverty on a grand scale is one of the world’s most pressing issues today. Is it possible to make progress against this issue? To understand where we come from, we must travel across time. Thirty or even fifty years is insufficient.
When you simply analyse what the globe looked like throughout our lifetime, it is easy to infer that the world is static (with better portions of the world here and poorer sections there) and that it was always this way. This will be the case. When you look at things from a different viewpoint, it becomes evident that the world is far from static. We have the power to transform the world. Just a few generations ago, the wealthy countries were impoverished. To avoid statically depicting the globe – the North is always considerably wealthier than the South – we must go back 200 years before living circumstances altered dramatically.
Living on less than $1.90 per day is considered ‘severe poverty’ by the United Nations. This is a very low poverty level used to highlight the world’s poorest people.
Non-monetary means of income are included in these poverty estimates, which is crucial for poor families now and in the past, especially because many of them are subsistence farmers who rely on their food production. The extreme poverty gauge is also adjusted for price fluctuations over time (inflation) and compensated for varying price levels in different nations; poverty is assessed in the so-called ‘international dollar.’ In 2011, an international dollar had the same purchasing power as a US dollar as a result of these modifications.
Estimates of the fraction of the world’s population living in extreme poverty are shown in the first graph. Only a small elite had improved living conditions in 1820, but the great majority of people suffered in what we now term abject poverty. Since then, the percentage of severely impoverished individuals has progressively decreased. As more parts of the world became industrialised, productivity grew, allowing more people to escape poverty: in 1950, two-thirds of the world lived in extreme poverty; in 1981, it was still 42 per cent. The fraction of the world’s population living in extreme poverty fell below 10% in 2015, the most recent year for which we have statistics.
The $1.90 poverty level is extremely low because it only applies to the world’s poorest people. In terms of the most impoverished people, the globe is likewise making progress. In reality, regardless of whose poverty level you choose, the number of people living in poverty has decreased internationally (see here).
For me, as a scholar who studies growth and inequality, that is maybe the most significant achievement of the previous two centuries. This is especially impressive given that the world’s population has grown by a factor of seven in the previous two centuries: disable the ‘Relative’ option in this visualisation to view the number of individuals in and out of poverty. Multiplying the population by 7 would have resulted in ever-decreasing earnings for everyone in a society without economic progress, and it would have been enough to plunge everyone into abject poverty. However, the exact reverse occurred. At a time when the world’s population was growing at an unprecedented rate, our globe was able to deliver greater wealth to more people and continue to elevate more people out of poverty.
Increased production was crucial because it reduced the scarcity of essential commodities and services such as food, clothes, and housing. Productivity is the link between the outcome of our work and the input we put into it. As productivity improved, we gained more output but also fewer inputs: weekly working hours were significantly decreased.
Economic development was also significant since it altered people’s relationships. During the long period when the world was stagnant, the only way to improve was for someone else to deteriorate. It was a no-win situation. Your good fortune was due to the misfortunes of your neighbours. Growth in the economy altered that; it allowed you to be better off while others were better off. Some people benefited from the inventiveness of those who created the technologies that improved productivity—modern transportation, manufacturing machines, and communication technology—while others saw their productivity and earnings rise. It is difficult to emphasise how different life is in a positive-sum economy versus a zero-sum economy.
Unfortunately, the media is too preoccupied with covering one-off events and mishaps to pay enough attention to the long-term trends that are transforming our society. We may outline what a medium for reporting on global development might look like using this empirical fact on poverty reduction. ‘The number of people in severe poverty has reduced by 130,000 since yesterday,’ the headline might read, and it would be repeated every day since 1990 when there were 130,000 fewer people in extreme poverty on average every day. The figures are considerably more stunning if you choose a higher poverty threshold.
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