Tuesday, September 27, 2005

Poverty in "rich" countries

The data is from UNDP's Human Development Reports (2005).

The International Poverty Line in rich countries - i.e. with a high human development level: income, health, education - is $11 (1994 prices) per day per person for a household of 3 persons. Following my estimates, that must come close to an income per household of $15,000 per year in 2003 (US price levels). It may be a bit different for other countries because the cost of living is not the same.

Here is the data:

USA: 13.6% of the population are "poor" (following this definition)
Germany: 7.3%
United Kingdom: 15.7%
France: 9.9%
Canada: 7.4%
Australia: 17.6%
Netherlands: 7.1%
Sweden: 6.3%
Finland: 4.8%
Norway: 4.3%

Actually, someone argued with me that the US poverty rates are lower than in Sweden. I found it unbelievable and I checked the data.
What is stricking is that the country with the highest average income per person (USA) also have one of the highest poverty rate (only Australia and the UK has a worse record)

Some European countries with relatively high unemployment rates (France, Germany) also have lower poverty rates. It seems to be a contradiction but it is not. The American "poor" population tends to be kicked out of the statistics simply because they are no longer accounted in the labor force. Someone who has been out of work for a while would not be part of the statistics of unemployment... He is not searching any more!



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