A newly pro­posed inter­na­tional def­i­n­i­tion of the mid­dle class for devel­op­ing coun­tries, pro­duced by the Cen­ter for Global Devel­op­ment for the World Bank, has some sur­pris­ing con­clu­sions for India.

The report, pro­duced by the pres­i­dent of the Cen­ter for Global Devel­op­ment, Nancy Bird­sall, sug­gests that “mid­dle class” is defined as every­one with an income above $10 a day, exclud­ing those in the top 5% of earn­ers in the coun­try… mean­ing India has no mid­dle class.

This is a com­bi­na­tion both of the depth of India’s poverty and its inequal­ity. China had no mid­dle class in 1990, but by 2005, had a small urban mid­dle class (3% of the pop­u­la­tion). South Africa (7%), Rus­sia (30%) and Brazil (19%) all had siz­able mid­dle classes in 2005. […]

In socio-political terms, the mid­dle class is tra­di­tion­ally that seg­ment of soci­ety with a degree of eco­nomic secu­rity that allows it to uphold the rule of law, invest and desire sta­bil­ity. They do not, unlike those defined as rich, depend on inher­i­tances or other non-productive sources of income. […]

OECD coun­tries define their poverty lines as 50% of median income which works out […] to about $30 day. In the US the poverty line for a sin­gle indi­vid­ual in 2008 was $29 per day and for each indi­vid­ual in a four-person house­hold was about $14 per day.

How­ever, peo­ple in devel­op­ing coun­tries liv­ing on even $10 a day still have extremely low social indi­ca­tors. Econ­o­mist Lant Pritch­ett has shown that infant mor­tal­ity of house­holds in the rich­est quin­tile in Bolivia was 32 and Ghana 58 per 1,000. Fewer than 25% of peo­ple in the rich­est quin­tile in India com­plete 9 grades of school, Pritch­ett showed. “An upper limit of the 95th per­centile, while on the high side, is just about suf­fi­cient to exclude the coun­trys rich­est,” Bird­sall adds.

via The Browser