Angus Deaton, the economist who won a Nobel Prize this week, has spent much of his career trying to measure poverty and progress in India and China.
He won the Royal Swedish Academy of Sciences award in economics by devising systems to understand consumption and poverty using household surveys and number crunching.
“Deaton’s focus on household surveys has helped transform development economics from a theoretical field based on aggregate data to an empirical field based on detailed individual data,” the academy said.
His decadeslong deep dive into data on the poor, their spending habits and their health gave him a surprisingly upbeat assessment of human progress, largely owed to the great strides that have been made in China and India. His book, “The Great Escape: Health, Wealth, and the Origins of Inequality,” documented why the world is a better place to live than it used to be.
A recent World Bank report suggested that more than one billion people might have been lifted out of extreme poverty already this century. Most of that progress was in China and India.
Here are a few of the things Mr. Deaton said in his book about the massive shifts in China and India that are changing the world.
On what China and India have taught us … “China and India are the success stories; rapid growth in large countries is an engine that can make a colossal dent in world poverty.”
On infant mortality in India and China … “India’s decline in infant mortality has been remarkably steady–not at all responsive to changes in the rate of growth–and the absolute decline from 165 out of every 1,000 babies dying in the early 1950s to 53 in 2005-10, is actually larger in absolute numbers than the decline in China, from 122 to 22.”
On how Chinese and Indian bodies have evolved with the economy… “Indian children are still among the skinniest and shortest on the planet but they are taller and plumper than were their parents or grandparents … Indians too are now growing taller decade by decade, though not as quickly as happened in Europe, or indeed as is now happening in China, where people are growing at about (the now familiar figure of) a centimeter every decade. Yet the Indian escape is only half as fast–about half a centimeter a decade–and that figure is for men; Indian women are growing too, but at a much slower rate, so that it takes them sixty years to grow a centimeter.”
On a better measure showing how China and India have lifted the world … “Although China and India are only two countries, their rapid growth at the end of the century meant that around 40% of the world’s population lived in countries that were growing very rapidly … (Thus) the average country grew at 1.5% a year in the half century after 1960, but the average person lived in a country that was growing at 3%.”
On how long the miracle can continue … “At least over the past half-century the fast-growing countries in one decade have tended not to repeat their performance in the next or subsequent decades. Japan used to be the place that had perpetually high growth, until it didn’t any more. India, now one of the most rapidly growing countries, seemed capable of only slow growth for much of its existence, not to speak of the half-century that preceded its independence, when there was no growth at all. China is the current long-run superstar, but by historical standards the longevity of its growth spurt is extremely unusual.”
On the difficulty of defining poverty … “In India, as in any country where a substantial fraction of the population is poor, there are millions of people who are close to poverty, either just above or just below the line … We don’t really know where the line should be, yet its precise position makes a huge difference. To put it more brutally, the truth is that we have little idea what we are doing.”
Source: Nobel Prize Winner Angus Deaton on the Chinese and Indian Miracles – China Real Time Report – WSJ
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