The Median is the Message: A Good Enough Measure of Material Wellbeing and Shared Development Progress
| Author | Christian J. Meyer,Nancy Birdsall |
| Date | 01 November 2015 |
| Published date | 01 November 2015 |
| DOI | http://doi.org/10.1111/1758-5899.12239 |
The Median is the Message: A Good Enough
Measure of Material Wellbeing and Shared
Development Progress
Nancy Birdsall and Christian J. Meyer
Center for Global Development
Abstract
We argue that survey-based median household consumption expenditure (or income) per capita be incorporated into
standard development indicators, as a simple, robust and durable indicator of typical individual material wellbeing in a
country. Using household survey data available for low and middle-income countries from the World Bank’s PovcalNet
tool, we show that as a measure of income-related wellbeing, it is far superior to the commonly used GDP per capita
as well as survey-based measures at the mean. We also argue that survey-based median measures are ‘distribution-
aware’, i.e. when used as the denominator of various widely available indicators such as mean consumption expendi-
ture per capita they provide a ‘good enough’indicator of consumption (or income) inequality. Finally, as a post-2015
indicator of progress at the country-level in promoting shared development and reducing inequality, we propose that
the rate of increase in median consumption per capita after taxes and transfers exceeds the rate of increase in average
consumption in the same period.
Policy Implications
•Survey-based median household consumption expenditure (or income) per capita should be incorporated into stan-
dard development indicators.
•Median consumption per capita has three advantages over commonly used measures of material wellbeing: sim-
plicity and accessibility, durability and relevance as a broad reflection of development as a modernization process.
•As a post-2015 indicator of progress at the country-level in promoting shared development, we propose that the
rate of increase in median consumption per capita after taxes and transfers exceeds the rate of increase in average
consumption in the same period.
•The post-2015 development framework should include attention to the logic of good household survey data as a
global public good.
We argue that survey-based median household con-
sumption expenditure (or income) per capita should be
incorporated into standard development indicators, as a
simple, robust and durable indicator of typical individual
material wellbeing in a country (or in any geographical
or other dimension such as gender, as well as over time
in that dimension). As a measure of income-related
wellbeing, we show that it is far superior to the com-
monly used GDP per capita as well as survey-based
measures at the mean, as the mean measures exagger-
ate typical wellbeing due to the skewness in the con-
sumption and income distributions of virtually all
countries. We also argue that survey-based median
measures are ‘distribution-aware’, i.e. when used as the
denominator of survey-based mean consumption expen-
diture per capita they provide a ‘good enough’indicator
of consumption (or income) inequality. Finally, we pro-
pose the increase in median income or consumption,
ideally after taxes and transfers, as a post-2015 indicator
of overall development progress at the country level;
and the rate of increase in that median relative to the
rate of increase in the mean in the same period for
each country as an indicator of that country’s‘shared
prosperity’
1
or inclusive growth.
Median consumption expenditure per capita is not an
alternative to the more conventional measures including
those that measure the incidence and depth of poverty,
nor the Gini coefficient, the Theil index and other mea-
sures of inequality. However it has the advantage of clar-
ity and simplicity, and has not been used widely in the
Global Policy (2015) 6:4 doi: 10.1111/1758-5899.12239 ©2015 University of Durham and John Wiley & Sons, Ltd.
Global Policy Volume 6 . Issue 4 . November 2015 343
Research Article
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