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Citation Information

Type Conference Paper - 12th National Convention on Statistics (NCS)
Title Will the Recent Robust Economic Growth Create a Burgeoning Middle Class in the Philippines?
Author(s)
Publication (Day/Month/Year) 2013
City Mandaluyong City
URL http://nap.psa.gov.ph/ncs/12thncs/papers/INVITED/IPS-24 Poverty and Inequality I/IPS-24_1 Will the​Recent Robust Economic Growth Create a Burgeoning Middle Income Class in the Philippines.pdf
Abstract
It is now widely-accepted that the development of a nation hinges on building its middle class. With the impressive 6.8% growth of the country’s Gross Domestic Product (GDP) for 2012, and four consecutive quarters of GDP growth of more than 7.0% since the third quarter of 2012, as well as the ratings upgrade to investment grade by Standard & Poor’s and Fitch, and the expected similar upgrade by Moody’s, the prospects for the Philippines joining the Asian tigers have surely become rosier. To achieve this goal, the Filipino middle class will have to play its role. However, aside from the fact that there is no internationally-adopted definition of the middle class, the systematic generation of data on the middle class has not been institutionalized in the Philippine Statistical System (PSS). During the 10th National Convention on Statistics (NCS), Virola, Addawe & Querubin presented a paper that used cluster analysis and multiple regression to propose two possible definitions of the middle class, one based on income and the other based on socio-economic characteristics. The paper used the 1997, 2000 and 2003 data from the Family Income and Expenditures Surveys (FIES) and the January 2001 and 2004 Labor Force Surveys (LFS). During the 11th NCS, Virola, et. al. updated and improved on the 10th NCS paper, adding auxiliary variables as well as two-way interaction among independent variables in the multiple regression component, and using data from the 2000, 2003, and 2006 FIES and the January 2001, 2004 and 2007 LFS. The most worrying result that the two papers showed is a shrinking middle class in the Philippines. Convinced that the PSS should sustain the generation of statistics that can contribute to policy formulation towards the protection of the middle class, in particular, and to evidence-based decision making towards national progress in general, this paper will
highlight the socio-economic and demographic characteristics as well as the province of residence of the Filipino middle class. It will also assess whether the middle class has started to expand preparing the country better for the development challenges ahead. As in the previous papers, data from the FIES and the LFS will be used.

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