NEW YORK (MainStreet) To measure poverty in the developing world most economists look at how many people survive on $2 per day or less. It's the standard benchmark, compared to America where the official poverty line for one person is worth approximately $32 per day. Recently, a pair of economists from the Brookings Institute decided to turn that lens inward.
According to work by researchers Laurence Chandy and Cory Smith, millions of Americans might fall below even third world definitions of poverty. Calling their results "striking," the researchers said that anywhere up to 12 million Americans could fall below this threshold depending on the definition of personal resources and the data sets used.
"Obtaining a definitive estimate of $2 a day poverty would require an uncontested definition of poverty and a data source with no flaws neither of which we have," Chandy wrote. "While the estimates we obtain vary, the fact that even some have millions of Americans living under $2 a day is alarming."
It is also noteworthy, the researchers mentioned, that since 1996 the number of people living on $2 per day has fallen worldwide while in the U.S. it has jumped.
Asked why they conducted their research, Chandy and Smith said that they wanted to challenge the idea that desperate poverty only exists in third world countries. Generally economists, such as those at the World Bank, assume that the entire population of wealthy nations is well off relative to the rest of the world, even though that seems not to be the case.
"[G]oing forward, the assumption that extreme poverty does not exist in the developed world is likely to face greater scrutiny," Chandy and Smith wrote.