The Developing World's Bulging (but Vulnerable) Middle Class
Although barely 80 million people in the developing world entered the Western middle class over 1990-2002, economic growth and distributional shifts allowed an extra 1.2 billion people to join the developing world's middle class.
Four-fifths came from Asia, and half from China. Most of the new entrants remained fairly close to poverty, with incomes now bunched up just above $2 a day. The vulnerability of this new middle class to aggregate economic contractions is evident in the fact that one in six people in the developing world live between $2 and $3 per day. Over time, the developing world has become more sharply divided between countries with a large middle class and those with a relatively small one, with Africa prominent in the latter group. Poor people in countries with smaller middle classes may well be more exposed to slowing economic growth.
