According to The Economist, more than half of the world is now middle class, defined as
the possession of a reasonable amount of discretionary income. Middle-class people do not live from hand to mouth, job to job, season to season, as the poor do. Diana Farrell, who is now a member of America's National Economic Council but until recently worked for McKinsey, a consultancy that has spent a lot of time studying the middle classes, reckons they begin at roughly the point where people have a third of their income left for discretionary spending after providing for basic food and shelter. This allows them not just to buy things like fridges or cars but to improve their health care or plan for their children's education….
Almost 60 percent of the world now meets The Economist's standard, up from just over 40 percent at the turn of the century. Why have standards of living surged? Due to economic growth based on the liberalization of trade and other economic factors.
Hat tip: Alan Vanneman
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