Today, less than 10 percent of the world population lives in extreme poverty. Based on information about basic needs collected from 15 low-income countries, the World Bank defines the extreme poor as those living on less than $1.90 a day. However, because more people in poverty live in middle-income, rather than low-income, countries today, higher poverty lines have been introduced. These lines are $3.20 and $5.50 a day, which are more typical of poverty thresholds for middle-income countries.
These higher poverty lines highlight that although a large proportion of people in middle-income countries lives above the $1.90 threshold, many still live on less than $5.50 a day. For example, in Indonesia and Pakistan, both lower-middle-income countries, only 7 and 5 percent of people live on less than $1.90 a day. However, 26 and 33 percent of the population in these countries live on less than $3.20 a day and more than two-thirds and three-fourths of the population live on less than $5.50 a day. Even in Mexico and China, both upper-middle-income countries, over 25 percent of the population lives on less than $5.50 a day.
To learn more about higher poverty lines, read the recently released Poverty and Shared Prosperity report 2018, “Piecing Together the Poverty Puzzle.”