CGD in the News

Middle Class: Who Are They? (The Times of India)

December 4, 2012

CGD President Nancy Birdsall is quoted in a piece on the rising middle class in India.

From the article:

Think tanks across the world have made several attempts to define the Indian middle class over the last couple of years, but do these new definitions capture the reality? Economists are finding that it's not just the statistics that make the Indian middle class; it's also more complex philosophical questions.

A clear statistical definition of the Indian middle class has long been elusive.

At a conference in Delhi two weeks ago, economist Nancy Birdsall, who is the founding president of the Washington-based Centre for Global Development, proposed a $4- $10 range for a class she described as the "catalyzing class" : non-poor and not-quite middle class. In India, 150 million people, or 12 per cent of the population, are in this class, which Birdsall projects, will rise to 30 per cent by 2020 and 44 per cent by 2030.

While these numbers identify a class firmly in the middle of the income distribution of a country like Brazil, the $4- $10 range is still among the top 30% of Indians. "In India you could argue that the right thresholds are a little lower, " admits Birdsall. But she adds that "$4- $10 is not unreasonable".

Indeed it would appear that the "traditional" middle class desire for stability is more closely associated with India's rich. Birdsall calls her not-poor but not yet middle class the "catalyzing class" precisely because it is a volatile class that is too vulnerable yet to be able to sink into middle class calm.

"This rising vulnerable class has the incentives to demand a level playing field, end of corruption etc since without political connections and deep pockets they are losers, not winners in the system, " says Birdsall, illustrating her point with the example of the Tunisian fruitseller Mohamed Bouazizi whose immolation in protest against a bribe lit the spark for the Arab Spring. "They can become the allies of the traditional middle class in supporting good government. But if frustrated, they can be a source of political instability who at worst resort to self-defeating populism," says Birdsall.

Read it here.

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