Questioning the great transition into a "global middle class"
Economist STEVE KNAUSS, in a new paper published by the CANADIAN JOURNAL OF DEVELOPMENT STUDIES, examines the "myth" of the global middle class and the claim that the $2/day measurement tells us anything substantive about poverty and inequality around the world.
"On the defensive in recent years, advocates of globalization have taken to highlighting achievements in developing countries, where globalization has supposedly pulled the majority out of poverty and catapulted them into the swelling "global middle class" remaking our world. This article provides a critical look at this interpretation. Carefully reviewing the global income distribution data behind such claims, it presents original calculations that generate new stylized facts for the globalization era.
The global income distribution approach does potentially have much to offer in terms of revealing the complexity of these changes, but in order to do so, greater attention and resources should be devoted to deepening our knowledge of the socio-historical changes underpinning the new realities of class formation and how they relate to the observed changes in global incomes. Instead of, or in addition to, constructing groups according to income thresholds, or national/global based deciles, ventiles or percentiles, more research should start from the other end, identifying national and global groups based on similarities in class formation and then attempting to trace such trajectories through the global income distribution."
"The question is: does their new petty income from the informal sector compensate for their loss of rural land, livestock, etc? It is not clear that it does. Therefore, we cannot say that this is a straightforward narrative of 'progress'—at least not in all regions."
Link to Hickel's thread.
- Development economist Morten Jerven with a 2010 paper diving into the metrics question in the context of poverty in Africa: "The article therefore concludes that it is futile to use GDP estimates to prove a link between income today and existence of pro-growth institutions in the past, and recommends a searching reconsideration of the almost exclusive use of GDP as a measure of relative development." Link.
A new model for social science research
The landmark Fragile Families and Child Wellbeing Study has been collecting a variety of data on almost 5,000 children for over 15 years. The rich dataset has allowed for a variety of studies: "These data have been used in hundreds of scientific papers and dozens of dissertations, and insight from these studies are routinely shared with policy makers around the world."
One offshoot of the larger study is the Fragile Families Challenge, for which teams of social and data scientists used the Fragile Families data to attempt to build accurate predictive models: "Given all the background data from birth to year 9 and some training data from year 15, how well could participants infer six key outcomes in the year 15 test data?"
A new paper from IAN LUNDBERG, ARVIND NARAYANAN, KAREN LEVY, and MATTHEW SALGANIK describes how the Challenge navigated the process and ethics of sharing the sensitive data about the people in the study.
"The detailed nature of the data made the project particularly valuable for developing knowledge about the lives of disadvantaged families, yet these very features also heightened concerns about privacy and ethics. In other words, the Challenge brought the tension between risks and benefits into sharp focus. In this paper, we provide no single solution to the fundamental tension between access and privacy; instead, we describe our process of addressing it. More specifically, this paper describes the privacy and ethics audit that we conducted from December 2016 through March 2017, as well as steps we carried out during the Challenge from March through August 2017."
- On the Fragile Families Challenge blog, Lundberg summarizes the new paper. Link.
- The paper contains the following excellent/illustrative anecdote about how Latanya Sweeney, as a graduate student working on an unrelated project, "was able to re-identify apparently anonymous medical records”: “She did this by combining the apparently anonymous medical records, which contained date of birth, zip code, and sex, with non-anonymous voter registration data, which also contained date of birth, zip code, and sex… Fortunately, rather than posting all of the records online, Sweeney mailed Massachusetts Governor William Weld a copy of his own records."
- A second new paper on the Fragile Families Challenge data describes "improving metadata infrastructure for complex surveys." "We hope that our work will facilitate new applications of machine learning methods to longitudinal surveys and inspire research on data preparation in the social sciences. We have open-sourced the tools we created so that others can use and improve them." Link.
- The Economist covers social wealth funds. Link. (More on Social Wealth Funds in a recent newsletter.)
- One of Marcy Wheeler’s “heroes of 2018”: the Big Cases twitterbot from Brad Heath. Link.
- "We find that local ICE partnerships reduce the number of Hispanic students by nearly 10 percent within 2 years. We estimate that the local ICE partnerships enacted before 2012 displaced over 300,000 Hispanic students. These effects appear to be concentrated among elementary-school students." Link.
- "Algorithms are not neutral. They are emblematic artifacts that shape our social interactions and social worlds. They open doors on possible futures. We need to understand their concrete effects. We need to imagine how they might work if they were designed and deployed differently, based on different priorities and agendas—and different visions of what our life should be like." Link.
- Important new research on the efficacy of various interventions in reducing homelessness. Among the findings: "Priority access to long-term rent subsidies reduced homelessness and food insecurity and improved other aspects of adult and child well-being relative to usual care." Link.
- From the Roosevelt Institute: a "blueprint for a robust 21st century antitrust regime that can begin to address today's market crisis." Link to the blueprint. Link to the corresponding blog post. For more on antitrust, Suresh Naidu, Glen Weyl, and Eric Posner published a paper at Equitable Growth that proposes methods for accurately assessing the labor market effects of mergers. Link.
- The second installment of historian Andy Seal's History of the History of Capitalism series examines "how proletarianization provided a standard plot for older histories of capitalism." Link.
- Bloomberg's Noah Smith imagines a U.S. office of industrial policy that would create place-based policies and local strategies to encourage revitalizations plans that fit each localities specific needs, strengths and resources. Link. (And more on place-based policies in our August newsletter.)
- At Data For Progress, a deep dive into the demographic distribution of progressive ideology. Link.
- Excellent Pseudoerasumus thread in response to a post from Branko Milanovic titled "Hayekian Communism." Covered within: growth in Taiwan under rule of Kuomintang, land reform in China and East Asia, counterfactual development history in China. Link. (And link to Milanovic's post, the content of which he says will be much expanded in his forthcoming book "Capitalism, alone.")