Why does it matter that a middle-class tipping point has been reached and that the middle class is the most rapidly growing segment of the global income distribution? Because the middle class drive demand in the global economy and because the middle class are far more demanding of their governments.

Consider the structure of global economic demand. Private household consumption accounts for about half of global demand (the other half is evenly split between investment and government consumption). Two-thirds of household consumption comes from the middle class. The rich spend more per person, but are too few in number to drive the global economy. The poor and vulnerable are numerous, but have too little income to spend. For most businesses, the sweet spot to target is the middle class. This has long been true in individual advanced economies; it is now true on a global scale.

Targeting the global middle class is not easy. The middle class like differentiated products, and their tastes will vary from country to country. The new middle class is predominantly Asian—almost nine in 10 of the next billion middle-class consumers will be Asian—but they are spread out in China, India, and South and South East Asia. It’s no accident that the latest Hollywood hit is Crazy Rich Asians or that Asian multinationals are emerging that have built a domestic brand and now look to compete abroad.