May 09, 2014
The new PPP numbers, based on 2011 data, include sharp upward revisions of the per capita incomes in big emerging economies such as China and India, making them statistically less poor than previously thought.
Economists at both the Washington-based Centre for Global Development and the Brookings Institution found that, based on the new data, the number of people under the existing $1.25 a day poverty line had fallen from almost 20 per cent of the developing world’s population to fewer than 9 per cent.
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Justin Sandefur, one of the CGD economists, acknowledged their calculations were not perfect. But he said they had generated the numbers quickly because of the big poverty discussions under way and that the bank had taken up to two years in the past to digest PPP updates. “If we are going to have real policy conversations about eradicating poverty … then we need to fix the goalposts,” he said.