what does "living on a dollar a day" mean in rigorous economic terms?

even if housing is free / self-made, a man has got to eat. So does this mean that people who “live on a dollar a day” manage to feed themselves with a dollar worth of food? Or does it mean that they can actually grow their own food of much higher worth than that, and the “dollar” part is just actual cash they make to spend on infrequent purchases like gardening tools and clothing? If the latter, does anybody estimate the effective income from subsistence farming in various poor countries in terms of the market price of the food produced?

I think this is an interesting question. You often hear stats about the per capita income in developing countries. I wonder if these figures are ever adjusted to reflect the local market value of food they grow/hunt etc. I also wonder if it makes sense to extend the analysis to houses they build rather than buy, clothes manufactured from animal skins or whatever…

In what context do you hear it?

Imho, I suspect in those “support a child in Africa for a dollar a day” commercials, the dollar subsidizes whatever charity group is already there, it doesn’t provide everything the child needs.


The article’s final paragraph implies that it counts cash expenditures. I’m not sure whether that’s the standard.

A dollar will buy more in some places than others. When I lived in Tbilisi (Republic of Georgia), my wife and I could go to a nice restaurant, with live music, candle light, a full meal with wine in a nice atmosphere and the bill would come to about $9.

The term you are looking for is Purchasing Price Parity.


People in the Third world living on a few dollars a day do better than you would do in the US on the same amount.

A dollar a day for food isn’t at all implausible, if you’re eating mostly rice and beans or the like.

No, I don’t mean the commercials. I mean the run-of-the-mill “it’s an unjust world, lots of people living on less than a dollar a day” type of chitchat.

Also, I am just in general interested in how cheap can food bill get to support an adult. E.g. is food bill somehow miraculously low in some places, when measured in constant dollars, based on the local market prices? Or are prices (at least when buying in bulk to eliminate exorbitant salary expenditures in rich countries’ retail outlets) fairly uniform across the board, and basically all this “dollar a day” stuff is a lie generated by dishonest foreign aid establishment that refuses to count non-cash income?

I think it’s just the average amount spent, not including subsistence farming. For example, if they use the dollar to buy water to drink, it doesn’t count the vegetables and fruits they grew on their farm or the fish they caught in the river.

Since Americans don’t produce anything (much less have dirt to grow anything in) the costs include purchasing food other people would raise or catch themselves, therefore “a dollar a day” sounds like a fairy tale to a Westerner.

Just think of all the people who no longer have to live on less than a dollar a day thanks to inflation in the US!

As far as I know, this refers to cash income. Here in Panama, plenty of families in remote areas probably have a per capita income of only a few hundred dollars a year. However, they build their own houses and grow most of their food. Their main expenses will be gasoline or kerosene, batteries, clothing, and a few other things they can’t make or grow. Cash income will come from sale of crops or wages for day labor.

My Mig’s brother makes about three dollars a day (peso equivalent of course) in rural Mexico. They own a patch of land where they grow alfalfa and a few veggies to feed the family. They have expenses despite owning their home and land. They had to pay for their water rights because the church owns the well. They have to pay taxes on the land. They had to pay for grain for the animals and clothes for their ever-growing family. I think there’s about eight of them living in a one room house where they just put in a roof. They had a tarp before. We sent them eighty dollars for that otherwise they’d do without. They have electricity now so there will be that to pay. They have to pay for the bus for their kids to get to school. School is free but there are still expenses for that. Most of their kids don’t even go though the younger ones do.

I can’t even imagine how they survive. I don’t think they would without us sending money every month.

Again, that could include all food costs. For comparison, a half-kilogram each of rice and beans would contain over 2500 Calories, easily enough for a person-day. That much rice would cost about 25 cents, and the beans would cost maybe twice that, for a total of $0.75 for a full day’s food. And that’s at American prices, even.

I’ll throw out some more comparative pricing for your enjoyment:

when i was in africa, I was able to purchase pineapples for 25 cents a piece in the equivalent of local currency. and they probably overcharged me for being a muzungu

On the other hand, when I was in Zaire in 1993, you had to be a millionaire to buy a beer. (A bottle of beer cost about 1.5 million zaires, or about one dollar).


can you REALLY buy rice in America for $0.25 per pound? I had the impression that it sells for closer to $0.7 - $1 per pound. Where do you go to buy it so cheap? Obviously, I don’t care about “organic”, “healthy” or anything else like that - as long as it’s good old white rice, it’s fine with me.

I believe that he may be quoting the commodity price of the good. you’re obviously not going to be able to pay that as it goes through a few middle men, but for large scale food relief agencies, they would probably pay very close to the commodity prices

Probably… I just Googled “price of rice” and grabbed the first link that looked promising.

I spent two years in Cameroon, a country where around half the population lives on less than a dollar a day (which is considered the de facto international poverty line.)

What can you do with a dollar a day?

If you are one of the countless people who have come to the cities looking for hard cash to send back to your family in the village- not a lot. While it’s true that the prices of basic things such as grains are much cheaper in developing countries, there are some necessities that are pretty much fix-price. Cooking oil, worldwide, is about two dollars a liter. In the village, when cooking oil prices rose, the women could produce their own cooking oil from peanuts. A person working full-time in the city does not have that option. Same with things like wood to cook over. In the village, when wood gets expensive you can walk out and cut some yourself. In the city, you are just screwed (and yeah, wood was a major household expense for people.)

A person making a dollar a day in Yaounde, the capital of Cameroon, would probably live in an improvised squatter settlement- perhaps a room made of scrap wood and tarps near the railroad tracks, shared by fellow migrant workers. He probably has enough money to take a city bus to his job, but not enough to go home to visit his family. He can afford grain-heavy meals and fruits, but can rarely afford meat or other protein. He might have siphoned electricity in his home, but when the power goes out, he may go to sleep early because candles and kerosene are expensive. When he gets sick he can probably afford black-market medicine, but will not be able to go to a reputable doctor.

In the village, a dollar a day will take you a lot farther- but you are less likely to have that dollar a day. A friend of mine, one year, managed to produce enough millet to feed his family, and enough cotton to earn him $17.00. That $17.00 is all of the cash that his family would see for the whole year- it’d have to pay for any schooling, any travel, any clothing, medicine, etc. It just wasn’t enough. People in these situations are so poor that they can’t afford the twenty cents it costs to get their millet ground in a mill- they end up pounding it itself- backbreaking labor.

In the village, you will probably have ample access to grains, but not to protein. An average serving of meat in North Cameroon is a couple of morsels the size of dice- and children probably wouldn’t even get that every day. While nobody is starving, you all probably get sick more often because most of your food is low-quality. You probably will not be able to send your children to school- even if school is free, there are books and pencils and uniforms to buy. And chances are there is no school in the village, so you’d have to board them. You may have electricity, but you will only keep on light on for a couple hours in the evening. If you don’t have electricity, you will use your stocks of kerosene or candles carefully. If you are lucky, you own a bed. But chances are that you and your children live, eat and sleep on mats on your hut’s gravel floor. If your kids get malaria, they may well die. Anti-malaria medicine costs about $3.00 a packet- which is probably beyond your meager reserves. Once a year, everyone in the family gets a new set of clothes.

Here are some samples of what you can buy with one dollar in Cameroon:
[li]Two large bars of soap (soap was considered a major household expense)[/li][li]Enough wood to cook on for a week[/li][li]A cheap Chinese made tee-shirt (African clothes, which you’d hope to have made once a year, probably would cost at minimum three dollars.)[/li][li]One bottle of Coke[/li][li]One meal at a nice restaurant or a couple of meals at a slop shack[/li][li]A long-distance bus ride of about one hour[/li][li]Five rides on a motorcycle taxi[/li][li]Five servings of street food (i.e. sticks of meat, plates of beans, fried sweet potatoes, sacks of peanuts, bags of juice.) [/li][li]One consultation with the doctor, but no drugs or tests[/li][li]One hour of Internet access[/li][li]Two small packets of powdered milk[/li][li]A half-kilo of dried fish (among the cheapest proteins.) [/li][li]A half-liter of cooking oil[/li][li]Enough laundry soap to last a couple weeks[/li][li]Five minutes of time on a telephone[/li][li]One pair of plastic flip-flop sandals[/li][/ul]

When you think about all the little things you need- soap, clothes, etc. it adds up. People making this kind of money are so poor that things like glass jam jars and old newspapers are considered useful commodities. They probably own little more a few cooking pots, some mats, a couple of wooden stools, a village-made knife, a few chickens and some sacks of millet.

It’s not easy.

Imho, it’s ~$.25 per serving, not per pound. After cooking, a pound of rice would roughly be about 8-12 scoops.