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Hauke Hillebrandt

Median GDP per capita: how much does the typical person earn in different countries? A look at Global Inequality

Check out our newer article from 2021 that goes into more detail on this topic.

A recent study asked people in the US what they thought the global median income was: participants thought it was $20,000 per year - 10 times more than it actually is.

 Respondents who were then told that the true global income distribution is much more unequal, i.e. that the global median income is much lower, supported higher spending on foreign aid and cuts in agricultural trade protections at larger rates. They also made donations to charities abroad that were 55% larger relative to people in the control group.

Whenever I read about a country that I don’t know that much about, GDP per capita statistics are usually the first thing I look up on Wikipedia. Of course, income only gives a limited picture of a country, but I want to get a general sense of the economic well-being of its people. But the 

 GDP per capita that one typically sees on Wikipedia can be quite misleading in that respect, because it doesn’t take into account wealth inequality (for a detailed explanation see the Appendix at the end of this post). And, until recently, 

 GDP per capita were hard to come by. But a few months ago, the Centre for Global Development released median income/consumption estimates of countries around the world.

This data was very useful for development economists who are interested in how many people live in extreme poverty with under $1,90 a day, but for lay people the problem with the presentation of the data was that it showed 

 income/consumption and most people are probably more used to think about 

 income/consumption. This is why I multiplied the values by 365 to get at the median income/consumption per capita per year around the world (I call this median GDP per capita for sake of comparison).

You can see that there’s considerable inequality within countries - in the United States $17,593 is the median income, whereas the mean GDP per capita is $54,629, which is what everyone would earn if you perfectly redistributed all income.

 inequality in terms of median GDP per capita per year: it ranges from $383 in Madagascar to $21,717 in Norway, with most values at the low end.

 The global median of these medians is $2,630 and the population weighted average of these median values is $4,114 - these two values might be good approximations of global median per capita

, and in line with older empirical estimates of $2,920 by Gallup

 - which is what everyone would earn if you perfectly redistributed all income worldwide.

You might notice that that these estimates are already Purchasing Power Parity (PPP) adjusted: this means that this already takes into account, for example, that housing is cheaper in Madagascar than in the United States, and that the government provides more services in the US. It also already includes goods people produce for themselves in the Madagascar (such as growing food or making baskets).

 In other words, when you read that Madagascar has a median GDP per capita (PPP) of $383 per year, then it is comparable to living on $383 per year in the United States. To get a sense of what this would be like you could go on Amazon.com and see 

How your money can buy somebody else more happiness

This immense global inequality makes the idea of 

 so powerful. GiveDirectly is a charity that sends unconditional cash-transfers through mobile phone banking to some of the poorest people on the planet. You get the same increase in wellbeing from having your $20,000 developed world salary doubled as someone in extreme poverty living on $383 in Madagascar would get from receiving a cash transfer that would double their income (see figure below).

A recent study calculated that because of this, 

giving a one dollar to a truly poor individual is worth the same as giving about $66 to a typical American.

 In other words, if you’d earn $60,000 after tax salary and donated $30,000 and thus forgo the doubling of your wellbeing, you could effectively double the well-being of over 300 people in Madagascar ($30,000/$383 * 4 (adjusting for PPP))! And cash-transfers are considered to be baseline for how much good you can do: Givewell estimates that our recommended charities the Against Malaria Foundation, the Schistosomiasis Control Initiative and the Deworm the World Initiative, are about 10 times more effective than cash transfers, because there is evidence that healthier children earn more later in life

. This means we have an incredible opportunity to do good in the world.

Two-thirds of the variation of how much you earn globally is determined by where in world you were born

**[10]****.** When you add how much your parents earn to this, 80 percent of the variance of how much money you earn is explained by things that are clearly beyond your control.

 Such injustice violates our moral intuitions that there ought to be 

You can check out how lucky you are in global terms with our 

Appendix: What’s the difference between median and mean GDP per capita?

The average or mean GDP per capita statistics can still be quite misleading,

 as it doesn’t take into account wealth inequality. Here are two countries fictitious countries to make the point:

Notice that wealthy people, like Bill Gates, skew the mean value, so that mean GDP per capita is not very representative of the typical person in a country. It’s better to look at 

 GDP per capita. To calculate the median or middle value, you just make a list of all citizens in a country by income/consumption and pick the one who is in the middle (in this case Bob). 50% of all people will be richer and 50% will be poorer than the person on the median income/consumption. This usually gives a better sense of what the economic well being of an average person is like. In both our countries, median income is $20,000.

Alison Woodman

Everything you always wanted to know about the pledge (but were afraid to ask)

Have you ever wondered whether the Giving What We Can pledge is right for you? Do you have unanswered questions which make you hesitate about signing up?

Recently Giving What We Can staff have been devoting some of our time to reaching out to people who are familiar with our work, to see how well we’re communicating our ideas, and to encourage more people to get involved. This has helped us identify a few recurring questions about the Giving What We Can pledge, so I thought I’d use this post to answer four of the most common ones.

1. I’m not earning an income right now/I’m a student, so I can’t afford 10%

For many people who are studying or unemployed, it may be much harder to give 10%. However, the Pledge commits members to giving 10% of their 

For any period where members are not earning an income, we suggest that they instead donate at least 1% of their spending money.

 This is a good way to create or maintain a habit of giving to effective charities, which we believe sets members up well to donate more once they start earning a salary.

Still, it’s understandable that some people remain unsure about committing to donate income that they don’t yet have. However, about 46% of our members joined as students, and we’re starting to see some of the effects of their donations as they graduate and move into work

, suggesting that pre-committing is a promising strategy for ensuring you act on your intentions to donate in future.

10% is no magic number, but it is one that we think 

. The average percentages donated in the UK and US, for most income brackets, seems to be about 1% - 5%

, so the Pledge represents a significant increase on this. However, for most people in affluent countries, it can be achieved without huge sacrifice. For instance, if you and a partner live on the median household income

 in the UK and have one child, we estimate that you’re in the richest 10.7% of the the world’s population. If you were to give 10% of your income, you’d still be in the richest 11.9%, earning 10 times the global average income. To see whereabouts you stand in the global income distribution, take a look at our 

Another reason to think that 10% is a good number to aim for is that there’s a 

 of donating 10% of one’s wealth, as shown by the inclusion of 

 in various religious traditions. Giving What We Can is not affiliated with any religion (we welcome members who are religious and non-religious alike), but the fact that many communities have succeeded in normalising giving 10% is an encouraging sign that this level of giving could become a norm more widely.

3. I’m already giving 10% or more - what’s the point in taking the Pledge?

It’s always exciting to meet people who had the idea to donate a substantial portion of their income before they heard about us. Some of these individuals are enthusiastic about Giving What We Can’s work but are skeptical about the benefits of joining the community.

The best indications of why it’s still a good idea to pledge come from listening to members who were already giving or intending to give 10% or more when they joined. Roughly 18% of our members are in this group - having spoken to many of them, we’ve found that a key reason they joined was to 

help Giving What We Can grow and inspire more people to give

Studies have shown that increasing visibility of donations, especially among peers, helps to create more charitable giving

. More anecdotally, I often hear that members value being part of a wider community of givers, and that part of the reason is that being able to reference a wider group who are also committed to giving 10% makes it easier to talk to others about their giving. This is important for the growth of the movement, since we’ve found that the most common way that new members hear about us is through their friends.

What’s more, it’s easy to lose track of our commitments, so even if you are giving 10% now it’s hard to be certain that you’ll continue to do this in future. The Pledge can act as another layer of accountability, both because members are making a public commitment, and because we follow up with our members to keep them motivated and give timely reminders of their pledge to give.

4. I donate to charities which aren’t on your list of recommended ones - can I still take the Pledge?

A distribution of insecticide-treated bednets by the Against Malaria Foundation, one of Giving What We Can's recommended charities.

While Giving What We Can conducts research and offers 

 about where and how to donate effectively, the Pledge does not require you to give to our recommended charities. The only requirement is that you give to the organisations which 

 will most effectively improve the lives of others. So while we think that the decision about where you donate to fulfil your Pledge is just as vital as the commitment to give more, it is definitely within the spirit of the pledge to give to organisations not specified by Giving What We Can.

Some members donate to non-poverty interventions, for instance improving animal welfare by following 

 recommendations, or mitigating existential risks by funding research through organisations like the 

. What’s more, wherever you decide to donate you will still be able to keep track of these donations using our 

So, to sum it all up: As a member of Giving What We Can you only give when earning, you will still be in the global rich, you will help make giving 10% more normal, and you can use your own head in deciding where to give. If you’d like to chat about the pledge, feel free to get in touch with me here (

). If you’re ready to take the pledge now you can do so 

, or if not, why not sign up to try giving 

For answers to other common questions about Giving What We Can, take a look at our

__. If you can’t find your questions there, or would like more information, please email us (

Sam Deere

Our largest trust payout yet — 77 malaria deaths prevented, food for thousands fortified, 100 people’s incomes doubled, and a quarter of a million children dewormed!

More than half a million pounds moved to top charities in Q1 2016

We’re really excited to announce our largest quarterly payout to our top charities ever. In the first quarter of 2016 Giving What We Can members, supporters, and our broader community donated more than 

77 malaria deaths prevented, food for thousands fortified, 100 people’s incomes doubled, and a quarter of a million children dewormed

 and other highly effective organisations , including:

 (≈US$220,942.00) to the Against Malaria Foundation, which is enough to distribute 41,608 

. Even though there is substantial uncertainty around these estimates, 

 that this might prevent 77 deaths of under 5 year olds in expectation.

 (≈US$142,168.15) to the Schistosomiasis Control Initiative and £82,382.68 (≈$119,430.17) to Deworm the World Initiative, which together will help to deworm around 262,100 children from parasitic worm infections.

 (≈US$113,343.36) to Project Healthy Children, which will support developing countries to incorporate micronutrient fortification into their food supply chains. Project Healthy Children is one of our ‘promising charities’ which means that it’s hard to quantify their impact with certainty, but we think it’s likely to have a very high impact, as potentially hundreds of thousands of people will consume staple foods like flour and oil that are fortified with vitamins and minerals.

 (≈$US 122,018.13) to GiveDirectly, of which 84.5%, or $103,105, will be transferred directly to the very poor, with the rest going to support their continuing monitoring and evaluation projects. This means that around 100 of the poorest people in Kenya and Uganda – people who live on less $1.90 a day now, will now be much more food secure and will have greater opportunity to invest in their futures by buying assets such as animals and iron roofs.

 to other highly effective charities, including Innovations for Poverty Action, Development Media International, and Iodine Global Network.

These figures don’t include donations by members made directly to top charities, or through partners like Transnational Giving Europe. As the chart below shows, most donations were from people coming to the Trust directly from our website, with a significant minority referred from GiveWell, payroll giving sources, or directly from a recipient charity.

It’s also very cool that about 63% of these donations are being made by non-members, which means we’re not just reaching people who have already taken the pledge, but are seeing members of the wider community taking the opportunity to donate more effectively too.

Thanks everyone who’s contributed to the efforts of some of the most effective charities in the world — here’s to Q2 being even bigger!

More info about the Giving What We Can Trust

Our Trust is a convenient way to support several highly-effective charities at once, and you don’t have to be a Giving What We Can member to use it. Because the Trust is a registered charity in the UK, donors can claim Gift Aid on donations to it — including those designated to overseas-based charities like Project Healthy Children, GiveDirectly, or Innovations for Poverty Action.

Here’s the full list of the highly effective charities you can support by donating to the Trust:

, and you can make both one-off or recurring donations. For more information, check out the 

If you don’t live in the United Kingdom you can still use the Trust, but your donation won’t be tax deductible. See our 

Together, Giving What We Can members are making a huge difference — if you’d like to join us, why not 

Larissa Hesketh-Rowe

Why should I give if the rich don't?

 — particularly internationally! At the same time, 896 million live on less than USD 1.90 per day and 3 million children die each year 

What can we possibly do about these issues? And, quite frankly, why should we do anything at all if others do not?

Do the actions of others change what we should do? What can we achieve if we are not millionaires?

According to the World Bank’s most recent estimates in 2012, 

896 million people lived on less than $1.90 a day

over 2.1 billion people in the developing world lived on less than US $3.10

 go to international charities each year.

What is more, it is the poorest in America that give the highest percentage of their income to charity. Research by the Chronicle of Philanthropy in 2011 showed that the wealthiest Americans—those with earnings in the top 20% in America—donated, on average, around 1.3% of their income to charity. 

Americans in the bottom 20% donated about 3.2% of their income

. Not only that but the rich were much more likely to donate to institutions in their circle: universities they attended or the arts, rather than charities that help the poor.

If the rich are not doing their part, why should we try and help the global poor?

It’s tempting to argue that since there are so many people out there with the money to 

, they should be the first to pick up this responsibility. They can afford it. They are rich!

. This places the average person in these countries in the 

. This means that, even accounting for the different costs of buying goods in different countries, 

we likely earn about 18 times the global average wage

Where do you fall against the global average? See for yourself with the Giving What We Can 

We are extremely fortunate in many developed countries. Not only do we have great education, health and other services, but we have a lot of financial freedom too. And we can use that wealth to do amazing things.

Still, unless you are Bill Gates, it is likely that there are a lot of people out there who are richer than us. So why should we be the ones to give?

, imagine yourself walking past a pond on the way to work. As you walk, you spot two children struggling in the water. They are drowning. They need help. You are not a very good swimmer but you could at least save one in time. You about to jump in to save them when you realise there is someone else by the pond. They are nearer the children and look to be stronger, perhaps a better swimmer. They might be able to help both children. But they are doing nothing. Would you now do nothing? Just because someone else who might be better equipped to help more people is not? Would you leave the one child you could have saved to die because someone else won’t help both?

When we are wondering about issues around wealth and responsibility we can ask ourselves, 

what kind of world do we want to live in? One where many people are leaping to help or only a select few?

If we want change we have to be willing to lead it.

The drowning child example may seem far removed from the large-scale issue of global poverty, with 

896 million people on less than $1.90 a day

. The problem may seem just too big for any one person to do anything impactful.

Blog

Median GDP per capita: how much does the typical person earn in different countries? A look at Global Inequality

Everything you always wanted to know about the pledge (but were afraid to ask)

More than half a million pounds moved to top charities in Q1 2016

Why should I give if the rich don't?

The Life Equation

Is there a more effective way of getting a (better) malaria vaccine?

How to improve women's health in poor countries

Can cancer interventions ever be cost-effective?

Four Ideas You Already Agree With (That Mean You're Probably on Board with Effective Altruism)

[Interview] Why Derek Thompson of The Atlantic took the Giving What We Can pledge