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Natura non facit sultum*: Lant Pritchett on poverty lines

The momentum seems to be building for a goal to “eradicate poverty by 2030.”

Reducing poverty is a noble goal, one to which I fully subscribe. But the “eradicate poverty” campaign is actually only focused on “extreme” poverty which is an absurdly low and completely arbitrary definition of the poverty.

I am for eradicating poverty, but real poverty, as experienced by billions of people in the world, not on the extremist vision of “dollar a day” poverty. There is no poverty line at a dollar a day (now really $1.25 in purchasing power parity currency units). A dollar a day global poverty line exists nowhere except in the minds of elite technocrats, advocates, and donors.

What would a “line” look like? There is line at 0 degrees Celsius. Below that line water is solid and above that line water is liquid. As water crosses the freezing point it changes states—it freezes. Similarly a person can be said to “have a fever” because we know that the normal, healthy human temperature is 37 degrees Celsius (98.6 F) and temperatures much above that are a reliable symptom of certain infections.

In contrast, as people cross the “dollar a day” poverty line…absolutely nothing special happens to anyone anywhere.

There is no line at dollar a day in objective indicators of well-being. The wide availability of multi-module household data sets allows us to construct graphs showing the relationship between non-money indicators of household and child well-being–like malnutrition or health or child enrollment or access to sanitation or access to electricity–and household economic status for dozens and dozens of countries. As people get more prosperous they are nearly always better off by nearly every indicator—but there is no line. There is no discontinuity or sharp non-linearity around a dollar a day poverty line in any country for any indicator.

There is no line at dollar a day subjectively assessed well-being…

There is no line at dollar a day in income dynamics…

The epigraph to Marshall’s Principle of Economics was natura non facit saltum—nature doesn’t jump.

The idea that people in a state or condition called “poverty” below dollar a day and are discontinuously not in poverty above that line–and that this matters in any way to the reality of people’s lives–belies this common sense and beggars belief.

And rightly so, it is demonstrably false

Lant Pritchett – Extreme Poverty Is Too Extreme (blog at the Center for Global Development)

* Or natura non facit saltus – I’ve followed Pritchett and Merriam-Webster here.

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