It is Spring Conference time at the Kennedy School, and I just spoke at a panel on demography, poverty, and development chaired by our Dean, David Ellwood.
I asked the audience a favorite question of mine: would you rather be poor in a rich country, or rich in a poor country. I gave them the following terms for thinking about the question:
- Assume you care only about your own consumption
- Define poor and rich as someone who is the in the bottom or top decile of a country
- Define poor and rich country analogously as a country in the bottom or top decile of the distribution of per-capita incomes across countries.
The audience was divided evenly between those who would choose to be rich in a poor country and those who would rather be poor in a rich country. The real answer is that it is not even close. This has important implications for how we think about poverty reduction in the world.
Can you guess what the correct answer is?