A little more than 160 years ago, a powerful analysis of the role of the middle class in economic development was unleashed on the Victorian public. It described how monopolistic guilds had been "pushed on one side by the manufacturing middle class" which "developed [and] increased its capital" as it reformed economies and polities. The middle class had "created more massive and more colossal productive forces than have all preceding generations together," the text suggested.
A century and a half later, few subscribe to the political doctrines of that analysis, Karl Marx and Friedrich Engels's Communist Manifesto. Yet the idea of the middle class as central to economic growth and democratization is still very popular. Indeed, the view that "bourgeois" values -- seen by Marx as an important stepping stone on the way to revolution and utopia -- are a vital part of progress to the end of history is almost universally held among middle-class historians and middle-class political scientists. Why did Britain lead the world in the 19th century? Because of "the great English middle class," answers Harvard University economic historian David Landes in his magisterial book, The Wealth and Poverty of Nations.
For the future, continuing worldwide growth through closer integration in the 21st century will "depend on what can be done for the great global middle," suggests U.S. President Barack Obama's former economic advisor Larry Summers. It is hard to think of any greater shibboleth in American politics; in January 2010 Obama convened a task force dedicated entirely to its needs. But this isn't just an American mania; it is worldwide. Indian Prime Minister Manmohan Singh, for example, has called for "thinking people … from enlightened middle classes" to play a larger role in public life.
But is there any evidence to support the argument that the middle class is so vital to prospects for stability and economic growth? In fact, the middle class exhibits little more of the entrepreneurship or social progressiveness that is typically ascribed to it than do poor people.
And who, exactly, is in the middle class? That is a matter of some confusion. In their paper, "What Is Middle Class About the Middle Classes Around the World?" MIT economists Abhijit Banerjee and Esther Duflo use a historical estimate based on the British middle class, which is often thought to be critical to Britain's rise as a world power. They suggest that income for a family living off the wages of a clerk in his 30s in Britain in 1825 would be about $10 per person per day in today's U.S. dollars. They define a middle class as people with incomes between that level and the global poverty line of $2 a day. Economist Homi Kharas at the Brookings Institution, meanwhile, uses a definition stretching the other direction from the $10 mark, between $10 and $100 a day. Nobody is middle class according to both definitions.