Brad DeLong wrote:
>
> So the answer to your question is that the bottom 20-40% aren't better
> off not (much, if any). On the other hand, India's middle class--the
> 50th to the 90th percentile--are still very poor by U.S. standards, and
> their incomes have grown remarkably.
>
again, i am not sure that the spread of this growth is even. take
for example, my sister, who is a bank employee, and a friend who is
a software engineer. from 1990 to 2000 my sister's income grew by
about 150%, some of it due to her moving up the ladder. compare to
my friend, whose income has grown 10 times. he recently purchased a
home in what used to be the middle-upper-middle-class region of a
large city (bangalore) while my sister moved out a bit farther out
of the city due to the unaffordable rent and real estate prices. my
sister, btw, is in a two-income family and is part of the upper
middle class. this is purely anecdotal, of course (to see how these
incomes correlated with the mentioned real estate prices: i do not
know exactly the cost of homes in bangalore, but in madras, a
similar city, during the same period, the price of a middle income
home quadrupled). the people do follow the trend and IT training
did become a "hot" field in the period and therefore there was a
significant number of people who grew rich (*).
by any chance do you have the numbers on the growth of the middle
class income in the 90s?
also, the lower you go down the income ladder, the more unreliable
the numbers, at least those that come from govt agencies and the
census (i myself assisted in the 80s census and there is severe
lack of information w.r.t the bottom half of society).
certainly consumption has gone up (and i would guess personal
savings have reduced dramatically) and there are signs of greater
wealth among the middle class (at least 50% of it). it does not
seem illogical to me to suggest that indeed people are as a whole
better off at this point in time (this is helped, to misuse the
word, by the lack of gradation in the utter suffering of the bottom
30 or 40%). my questions to you would be: 1) do you see this as a
sustained trend (and i am wary of such claims. my own education is
in mathematics/computer science and against my doubts i bought into
the notion, held and argued by those trained in these matters, that
the 1997-2000 boom in the US stock market w.r.t tech stocks was
sound and sustainable a.k.a "the new economy"), despite the issues
mentioned such as environmental damage, health costs, etc? and
2) to what do you attribute this change? economic liberalisation?
on an aside: i do not have the list welcome message with me here at
home, and i hope my ongoing expression of layman questions and views
are not in violation of the charter of the list.
--ravi
(*) i see here the kernel of what is possibly a well understood
theory in [classical?] economics: that the anecdotal example is
misleading and the boom in a sector will ultimately lead to more
entrants into it and provide therefore a means for a large number
of people to gain employment and enter the middle class? if so, as
you point out, given the poor level of education availability, the
boom in high tech sectors would lead to further barriers for the
poor, would it not? if so, then the poor are left only with what
"trickles down", isnt it?
