1. Is Capitalism Good for the Poor
Gary Wolfram
William Simon Professor of Economics and Public Policy
Hillsdale College
Gary Wolfram

2. What is Capitalism? System based on: Private Property Rights
Voluntary Exchange
Limited Government
Rule of Law

3. Key Characteristics of Capitalism
1. Voluntary Exchange
2. All Parties Benefit
3. Must Please Others To Get Wealthy
4. Incentive to Innovate

4. Most Efficient System Voluntary Exchange
Pay Opportunity Cost for Resources
Value of Next Best Alternative
Produce Something Consumers Value More
Profit or Out of Business
Profit Measure of Efficiency

5. Central Planning Not Good for Poor
Incentive Problem
Profit
Information Problem
Prices

6. Why Poor Benefit Incentive to Make Things for Poor
Industrial Revolution
Cell Phone
Incentive to Make Them More Productive
Add Physical Capital
Add Education
Outsourcing is really moving capital to poor

7. Does It Work?
766 million people world-wide live on less than $1.90 per day in 2013 (10.7% of population)
Sub-Saharan Africa 41% live on less than $1.90 per day, million
Number has increased from 276 million in 1990 to 389 million in 2013 (percentage fallen 54 to 41)
49% of children in Sub-Sahran Africa extreme poverty
Gross National Income per capita Sub-Saharan Africa $1505 in 2016 (US $56180)
Life expectancy in Sub-Saharan Africa is 59 (2015) US (2016)
Sources:
First 3 bullets from
Bullet 4 ishttps://
Bullet 5 and 6 is
27% of all children in developing countries underweight or stunted, less than 3% of U.S. poor children:
Poverty ijn a Rising Africa World Bank
Poverty Program- Poverty Statistics
The World Bank- Poverty and Equity
TradeAID Integrated: Africa and Poverty
Life expectancy is 57 (2013):
World Bank Data- Sub-Saharan Africa (Developing Only)
239 million undernourished:
Food and Agriculture Organization of the United Nations- globally almost 870 million chronically undernourished - new hunger report
Good Source of Poverty Data

8. Poverty in Capitalism
40% own home—3 bedroom with one and one-half baths, garage, porch or patio
80% have air conditioning
Two-thirds have more than 2 rooms per person
More living space than average individual in Paris, London, Vienna, Athens
78% VCR or DVD Player
97% Color Television
89% Microwave Oven
From Robert Rector Heritage Foundation Paper

9. China and East Asia 1978 China Started Special Economic Zones
835 million, 88% of population living on less than $1.90 per day 1981
20.2 million, 1.9% of population in 2013
GDP per capita increased from $195 in 1980 to $8123 in 2016 (World Bank)
1980 East Asia poorest region in world now leading in economic growth and poverty reduction
China Growth Rate GDP 14.9% 2007, 9.6% 2008, 9.2% 2009, 10.4% 2010, 6.7% 2016
Is Capitalism Good for Poor Folder in my Files cabinet. Poverty Escape from Brookings Report and World Bank in Colorado Scott Hall 2013 Folder
Wikipedia on Poverty in China then Poverty and Equity country dashboard
GDP and China Growth Rates: World Bank Data-
GDP per capita

10. India India began market process early 1990s
Extreme Poverty: million,
45.9% Population 1993
268 million, 21.2% Population 2011
India GDP per capita increased from $300 in 1991 to $1709 in 2016
India Growth Rate GDP 9.8% 2007, 3.9% 2008, 8.5% 2009, 10.5% 2010, 7.1% 2016

11. History Lesson
During 1000 years monarchy mankind average income rose about 50%. Since 1820 rose by more than 1000%
In last 100 years created more wealth, increased life expectancy more, and reduced poverty more than in prior 100,000 years
In the year 1000 the average infant life expectancy 24, by1820 was 36 in the West
In 2015 was 70 in world and 79 in US (Monaco 89.5)
Average US household expenditures in 2015 of the lowest 1/5 of income distribution was $24,470
Is Capitalism Good for Poor? paper folder my file cabinet and Cato Letter Entrepreneurs are Heroes of the World Winter 2007 #1
Annual expenditure

12. Cross Section Evidence

13. Fraser Institute Top 10 Economic Freedom
Hong Kong
Singapore
New Zealand
Switzerland
Ireland UK
Mauritius
Georgia
Australia
Estonia
(US 11th)
For year 2014

14. Fraser Institute Bottom 10 Economic Freedom
Venezuela
Central African Republic
Republic of Congo
Algeria
Argentina
Libya
Syria
Myanmar
Chad
Iran