Global economic development has progressed with several highly regular patterns for more than half a century. These patterns may change, but their implications deserve much more attention and respect.
If I'm not mistaken, the DEM calculations and forecasts put quite a lot of importance in the “bucket” you put a country in.
But what if several low income or lower-middle income countries succeed in pushing just enough to get to sweet spot of being an emerging economy? Then, GDP per capita growth should accelerate, shouldn't it?
My assumption would be that this is a more likely scenario, at least for some countries. Every country that developed successfully reached this threshold at some point - and in different ways - and then growth really accelerated for several decades.
Or am I missing something?
Also, another thought:
You analyzed growth and development since 1980, which just be heavily skewed by China's rise in particular, to a lesser degree perhaps by the other Asian Tigers.
How would these models look for the period from 1945 to 1980 (or 1973)? Though many countries started from an extremely low level, their relative per capita growth was very impressive in that period (and that includes lots of developing countries - again, with the notable exception of China that hurt itself immensely).
Developed countries’ growth was also very fast.
That's not to say we'd see such a growth pattern come back. But it is an interesting contrast showing that the growth patterns of the last couple of decades are not necessarily the only ones that are possible.
Interesting comment, thanks! On the countries reaching a threshold, I'm not sure I totally understand your question, but we used a fixed definition of which country is in which income bucket (our Table S2), so we wouldn't have had countries changing buckets mid time series. On the timespan of our analysis, we fit the model on data going back to 1960. We showed that fitting 1960-1980, and then projecting from 1980 on did better at forecasting 2000s and 2010s growth than IMF, in most cases. Pre-1960 the data get sparser. It seems like some of the trends hold much farther back for large countries (e.g., see The Economist graph in the post on industry employment). Also, if you plot China's and the U.S.'s humped-shape growth patterns, they fit pretty well (China's peak rate is a bit higher I believe). Our pattern certainly gets noisier for smaller countries. That said, the point of the post (and to some extent the paper) is not to argue that these patterns can't or won't change, but rather to imagine what it would mean for them to stay the same.
great points. to get more growth, need land value tax plus yimby. to reduce inequality, need social wealth funds and capital inflow levies. to go green, need nuclear, which means dereg, which is yimby. plus industrial policy. to get more kids....no magic bullet. universal benefits plus growth plus lvt plus yimby might help?
This is a bit oversimplified, but your broad instincts are in generally the right direction I think. This was our take in 2021 (the Guided Civic Revival section), most of which still holds I think: https://www.nature.com/articles/s41562-021-01229-y
Interesting note. A few thoughts:
If I'm not mistaken, the DEM calculations and forecasts put quite a lot of importance in the “bucket” you put a country in.
But what if several low income or lower-middle income countries succeed in pushing just enough to get to sweet spot of being an emerging economy? Then, GDP per capita growth should accelerate, shouldn't it?
My assumption would be that this is a more likely scenario, at least for some countries. Every country that developed successfully reached this threshold at some point - and in different ways - and then growth really accelerated for several decades.
Or am I missing something?
Also, another thought:
You analyzed growth and development since 1980, which just be heavily skewed by China's rise in particular, to a lesser degree perhaps by the other Asian Tigers.
How would these models look for the period from 1945 to 1980 (or 1973)? Though many countries started from an extremely low level, their relative per capita growth was very impressive in that period (and that includes lots of developing countries - again, with the notable exception of China that hurt itself immensely).
Developed countries’ growth was also very fast.
That's not to say we'd see such a growth pattern come back. But it is an interesting contrast showing that the growth patterns of the last couple of decades are not necessarily the only ones that are possible.
Interesting comment, thanks! On the countries reaching a threshold, I'm not sure I totally understand your question, but we used a fixed definition of which country is in which income bucket (our Table S2), so we wouldn't have had countries changing buckets mid time series. On the timespan of our analysis, we fit the model on data going back to 1960. We showed that fitting 1960-1980, and then projecting from 1980 on did better at forecasting 2000s and 2010s growth than IMF, in most cases. Pre-1960 the data get sparser. It seems like some of the trends hold much farther back for large countries (e.g., see The Economist graph in the post on industry employment). Also, if you plot China's and the U.S.'s humped-shape growth patterns, they fit pretty well (China's peak rate is a bit higher I believe). Our pattern certainly gets noisier for smaller countries. That said, the point of the post (and to some extent the paper) is not to argue that these patterns can't or won't change, but rather to imagine what it would mean for them to stay the same.
great points. to get more growth, need land value tax plus yimby. to reduce inequality, need social wealth funds and capital inflow levies. to go green, need nuclear, which means dereg, which is yimby. plus industrial policy. to get more kids....no magic bullet. universal benefits plus growth plus lvt plus yimby might help?
This is a bit oversimplified, but your broad instincts are in generally the right direction I think. This was our take in 2021 (the Guided Civic Revival section), most of which still holds I think: https://www.nature.com/articles/s41562-021-01229-y