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In a recent Vox article, the author claims (without citation):

In 1820, some 94 percent of humans lived on less than $2 a day. Over the next two centuries, extreme poverty fell dramatically; in 2018, the World Bank estimated that 8.6 percent of people lived on less than $1.90 a day

However, I am afraid he did not adjust for inflation as this seems a frighteningly common problem with news media. Adjusting for inflation, $2 would represent ~$50 in modern purchasing power (About 7% of humans lived on > $50/day in 2011 according to Pew).

I cannot find world-wide wage information for 1820 to check this $2 figure however.

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  • 9
    Another thing it likely doesn't consider is the cost of living and in some places $2($50) a day is easy to live on while it is impossible in other areas.
    – Joe W
    Jun 8 at 0:21
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    @DavePhD Maybe there is a miscommunication but what I was saying is the amount you earn may or may not be below the poverty line in some parts of the world but enable a comfortable life in other parts.
    – Joe W
    Jun 8 at 2:01
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    The amount of dollars is a bit misleading. In South Arica, during the lockdown, after I lost my job I was living on 5.5K ZAR pm which is barely 350 dollars a month. I ate every day and had a roof over my head. I lived frugally over that period but I was far from poverty-stricken.
    – Neil Meyer
    Jun 8 at 8:13
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    $2/day would have been a large amount in 1820 in the terms used then, more than the pay of most senior officers of a ship (which they would then need to divide between the members of their family). The quotation is about $2 worth of income per person in more modern terms
    – Henry
    Jun 8 at 12:09
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    Also take into account that many people lived on self-sufficient farms, with effectively no income or expenditure. Jun 8 at 13:32

1 Answer 1

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According to World Income Inequality 1820-2000 by Joerg Baten, Peter Foldvari, Bas van Leeuwen and Jan Luiten van Zanden, Table 5, in 1820 73% of people had real incomes of less than 2 1990 dollars per day.

The 94% figure comes from Inequality among World Citizens: 1820-1992 by François Bourguignon and Christian Morrisson The American Economic Review, Vol. 92, No. 4. (Sep., 2002), pp. 727-744. This article says 94.4% of people were in "poverty" defined as "consumption per capita of $2 ... a day, expressed in 1985 PPP".

So some compensation for inflation was taken into account, but two 1985 dollars was about $4.18 in 2011. The World Bank offers a tool that tells you how many people were below an arbitrary income threshold in 2018, (in 2011 PPP dollars) and for $4.18 it gives 2.52 billion out of 7.6 billion, or 33%.

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    So these argue against the part of the OP: "I am afraid he did not adjust for inflation"
    – GEdgar
    Jun 8 at 0:35
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    @GEdgar there was adjustment for inflation, but $2 in 1985 is equivalent to $4.67 in 2018, not $1.90.
    – DavePhD
    Jun 8 at 1:43
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    So the answer to OPs headline question is essentially 'yes'.
    – quarague
    Jun 8 at 8:53
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    "94.4% of people were in "poverty" defined as "consumption per capita of $2 ... a day, expressed in 1985 PPP " - but in the claim we are comparing our values with 2018 data. According to [a random inflation calculator](officialdata.org/us/inflation/1985?endYear=2018&amount=1), 2$ in 1985 money would be 4.6$ in 2018. Jun 8 at 11:01
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    @quarague Is the 37% the last paragraph mentions close enough to 8.6% to say yes? I don't think most people would agree those are the same...
    – mbrig
    Jun 8 at 15:25

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