Is a growing Middle Class good for the Poor? Social Policy in a Time of Globalization
Middle-class expansion has long been pro-poor as the emerging middle class and the working poor tended to cooperate social policy. Over time, however, the middle class captured a growing proportion of the benefits of social spending, leaving less for welfare services for the poorest. In their report for the
Brookings Institution, Raj Desai and Homi Kharas examine the effect of this on extreme poverty across countries and over time; the mediating effect of the middle class on poverty through social policy choices on citizen eligibility for benefits; and the effect of middle-class size on social assistance and social insurance programmes in developing countries. They suggest that increasing social assistance, and altering the design of social insurance, are the policy areas most likely to benefit the poor.
https://www.brookings.edu/wp-content/uploads/2017/07/gd_20170713_working-paper-105.pdf
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