Lecture 17: Poverty
The question for today is whether poverty, especially poverty in the extreme sense of
having or not having enough to eat, is increasing or decreasing in the age of globalization, and if
it’s decreasing, why it continues to exist at all.
First, it’s clear that the world as a whole is getting richer, both in terms of absolute
wealth and terms of average wealth per person. One measure of poverty is whether you are able
to provide yourself with enough food. On average, there is more food per person that there was a
century ago. While the population of the world almost doubled between the early 1960s and
1999, the amount of food increased by two and a half times, with the result that the price of food
has been falling all over the world. What is more, total wealth has been growing faster than both
population and food supply, so that diet quality is improving, with more proteins and vegetables
and fewer starches and staples part of the average diet. While the population doubled and the
amount of food increased by 2 ½ times, the amount of pork has sextupled and the amount of
chicken dectupled. In short, the fear that the population explosion would result in mass starvation
has been disproved. There simply is no issue about our ability to grow enough food to feed all
the people in the world.
Meanwhile, the proportion of the budget spent on food is decreasing all over the world,
with levels never before seen of 12 to 15 percent spent in North America, a figure that includes a
lot of discretionary spending–eating in restaurants and so forth. Perhaps more significantly,
moving the percentage of family income spent of food from 80 to 60 percent in a poor Latin
American or South Asian household represents a huge increase in welfare for that household, in
terms of clothing, medicine, education, you name it, since it means that the amount of non-food
purchases has increased from 20 to 40 percent–in other words, it’s doubled.
As the amount that has to be spent on food has decreased, the amount available for other
necessities like clothing and shelter has increased; meanwhile, because of mass production, the
cost of clothing has fallen drastically. 100 years ago most people didn’t have more than one
change of clothes; and as for shelter, houses are larger and much better equipped than 100 years
ago. We can go on and on, but the point is that the world is much wealthier, and in fact much
more than four times wealthier, than 100 years ago.
If that’s the case, the next question is why famine and absolute poverty continue to exist