From The American Interest:
We’ve grown used to thinking of the developing world as a region beset by insurmountable poverty and strife, but the truth is that sometimes there’s good news too. A new report cited in the New York Times claims that the past few years have in fact been very kind to developing countries. Economists have been surprised to find that, despite the ravages of the global financial crisis, poverty has actually fallen across the developing world and some of the UN’s ambitious Millennium Development Goals have been reached ahead of schedule — and the number of people living in “extreme poverty” has been falling in every world region.
This is very good news, but it merits more study before we draw any broad conclusions. Economic statistics often bear only a hazy relation to the facts on the ground, and a small change in methodology can often change the outlook entirely. Estimating incomes is especially hard in developing countries, where informal economies are responsible for much of a country’s wealth. There are simply no reliable statistics for a country like Congo. Even purchasing power parity (PPP), generally touted as a fair comparison of wealth between the developing and developed worlds, is more of an accounting fiction than an actual measure of things.
But it’s safe to say that the overall trend lines in the developing world are pointing up, and that poverty is falling (little thanks to the antipoverty movement). That is something we should all be happy about; perhaps market capitalism isn’t as evil as its many critics allege.