OECD data on world wealth distribution by decile. The presentation is “Measuring the Global Distribution of Wealth” by James Davies, Rodrigo Lluberas, and Anthony F. Shorrocks.
If China is able to reform its urbanization safety net and enable 300 million existing migrant workers and 300 million new urban migrants to catch up to the current lower level of official urban residents then China will raise up people in the $1000-2000 per capita level to $3000 to 15,000 per capita in 2030.
In the chart above China would shift the lower end of its mostly poorer rural population, successfully into cities and get them to the top half of the world income levels.
If the world is able to enable programs that successfully eliminate extreme poverty, then that would raise the bottom decile from about $250-300 to $500 per capita. This would be like getting people in the bottom 10% in 2030 up the level of the 10.1-20% of about 1990.
The bottom 25% of the world population have a combined zero wealth.
Bottom 10% [0-10%] -0.2% of GDP [bottom 720 million people] Next 10% [10-15%] 0.1% of GDP [next lowest 720 million people] Next 5% [20-25%] 0.1% of GDP [next 360 million people]
Why do people or households who have over $100,000 keep generating more wealth ?
Those people have learned the basics of managing a household budget. They have gotten some residence (house) with either affordable rent or a managable mortgage.
They are not overspending on a car. A $300 per month car payment may seem affordable to someone who has no accumulated savings based on taking their monthly income and coming out positive. However, if they were able to keep transportation costs lower at $100 per month or less either with public transportation, an electric bike) or getting a good beater car. Then the $200 per month extra would be able going to paying down debt (usually at a high interest rate) or towards building wealth. Saving $1200 per year and getting invested returns.
The people who are scraping by in poor countries may not have economies where they can get a decent education or job.
Of course the people at the higher end are pulling away. They have achieved financial escape velocity.
They are not being pulled down with debt.
They are not going negative each month or year.
They have education or useful skills and thus a means of stable employment or they have a business of some kind.
Redistribution within say the country like the USA, it would be to take money from people who are financially prudent to give to people who do not have stable jobs and/or have too much debt and household budgets where they spend more than they take in.
If you were related to them, it would be taking money from yourself to give it to my dead beat relative. If they do not have a balanced budget (positive savings] and reasonable job stability, then they are a constant drain on the more productive family members.
However, it is justifiable to bring up the poor but it needs to be combined with job training and basic financial management training. This would be made more affordable if people were willing to delay spending and finding means of not spending if they cannot afford it.
Even in the best-case scenarios, the number of people without electricity will tick up to 1.5 billion by 2030, as population growth outstrips electrification. According to a recent study by the International Finance Corporation, an arm of the World Bank, $10 billion a year is spent on kerosene in sub-Saharan Africa alone to illuminate homes, workplaces and community areas. Globally, the figure has been put at $36 billion. Flexiway, an Australian-Argentine maker of solar lamps, found in its trials in Tanzania that households often spent more than 10% of their income on kerosene, and other studies have put the figure as high as 25%. And kerosene does not merely eat up household income that could be spent on other things. It is also dangerous. Kerosene lanterns, a century-old technology, are fire hazards. The wicks smoke, the glass cracks, and the light may be too weak to read by. The World Health Organization says the fine particles in kerosene fumes cause chronic pulmonary disease. Burning kerosene also produces climate-changing carbon-dioxide emissions.
There are now LED lights for $10-27 each with lumens 5-30 lumens of light.
Technological improvements in
* lowering the cost of LED lights
* lowering the cost of solar power
* increasing the brightness of LED lights
* increasing the power from solar power
* increasing the production of portable solar and LED lights
By 2017-2020, the $5-20 per person could provide lighting and electrical charging and basic electrical needs for every person in the world.
$30 billion to provide $20 of LED lighting and solar power to the 1.5 billion who would not have basic electrification through other means.
Fairly full featured smartphones cost under $100 in China now. By 2017, a $20 smartphone will be more capable that that $100 phone now.
$72 billion would be the cost of two years of kerosene spending to fill the basic electrification, lighting and communication gap.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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