2002-08: 60% Growth in World Per-Capita Real GDP
In his book "The Progress Paradox: How Life Gets Better While People Feel Worse," Gregg Easterbrook, senior editor at the New Republic and contributing editor to The Atlantic, castigates the media for dwelling on minor problems without celebrating the broader, more upbeat context in which they exist. One of the broader, more upbeat events of recent years is the significant and dramatic increase in real GDP per-capita worldwide. Using world GDP data from the IMF and world population data from the U.S. Census Bureau, the chart above shows real world GDP per-capita from 1985 to 2013 (data from 2008 - 2013 are estimated). After remaining constant at about $5,000 for 15 years from 1987 to 2002, real GDP per capita will increase 60% from $5,000 in 2002 to an estimated $8,000 this year. After leveling out for a year in 2009 due to the global economic slowdown (see arrow above), growth in per-capita real output is expected to resume in 2010 and exceed $9,000 by 2013.
Bottom Line: The 60% growth in world per-capita real GDP between 2002 and 2008 is probably one of the greatest periods of economic growth in such a short period of time in history, and is definitely part of the broader, more upbeat context of this period in history.
11 Comments:
Oh Yeah. A giant credit bubble that is now imploding was a great thing. Play it again Sam.
This the great unsung story of recent history. Great progress for the living standards of the world overall.
Unfortunately, most of the people in the USA have lost a little ground, and are angry for the tiny loss. After all, we have become used to constant improvement - so sharing some prosperity with the rest of the world makes us angry.
castigates the media for dwelling on minor problems without celebrating the broader, more upbeat context in which they exist.
Well, the larger scale events don't carry as well to the individual level. What individuals see are parts of the picture; more than a few are seeing the worse parts of it.
It is good news on the large scale, but is hard to explain on the individual scale. The least you'll get is that it is a rationale for ignoring/marginalizing them.
Actually, most people in the USA have not lost any ground -- as proven by recent posts on this blog regarding the growth in real compensation, not just real wages. Plus, it's difficult to quantity just how much our lives are better for the reduced cost of transmitting information (internet, cell phones, etc.), but rest assured it is not insubstantial.
This holiday season, I am thankful for Dr. Mark Perry for continuing to write this fantastic blog.
Anon, what are you doing on the intertubes? Isn't life so horrible that you are in crushng despair? With a nice computer? And clean water? And a roof over your head? Poor baby. I'll bet McDonalds got your order wrong again, too.
Fred -
I didn't write the Anon comment but I'll chime in.
Yes, life does pretty much suck, but I'm not yet in crushing despair, just a sort of low-level quiet desperation.
I am on the intertubes (happy retirement, Ted!) because it's included in the exorbitant rent I pay - forgoing its use would not improve my financial position. I do have a refurb computer - not sure it qualifies as "nice" - I earned by volunteering. And yes, I do enjoy clean water, for which I [pay through my rent. And the roof over my head (or at least my 10 x 10 part of it) requires two-thirds of my income.
But I haven't been to McDonald's in a long time, but when they got my order wrong, they fixed it in a hurry, so no complaint there.
People did not stop to help the employee as he lay on the ground, and they pushed against other Wal-Mart workers who were trying to aid the man. The crowd kept running into the store even after the police arrived, jostling and pushing officers who were trying to perform CPR, the police said.
“They were like a stampede,” said Nassau Det. Lt. Michael Fleming. “Hundreds of people walked past him, over him or around him.”
We've come a long way baby. Greed is good right?
All the world's major problems may be attributed to overpopulation, i.e. too many poor people, including at Walmart. Nonetheless, a sense of proportion is needed.
The U.S. captured much of that 60% in world growth in absolute terms, while export-dependent countries captured more in relative terms. I stated before:
In 2007, U.S. per capita income was $45,000 and China's per capita income was $2,000. If the U.S. gains $700 and China gains $300 for each $1,000 in trade, then U.S. income rises less than 2% and China's income rises 15% (however, unfortunately for China, when social costs are included, the U.S. may capture almost all the gains in trade).
There's been an unoticed or unreported Great Society program in the U.S. However, unlike LBJ's Great Society, GWB's Great Society has taken place mostly on the consumption side rather than the production side (although, the U.S. economy became much more efficient on the production side).
A woman at a Wal-Mart opening Friday in Farmingdale, about 15 miles east of Valley Stream, Suffolk County, was reported being trampled by overeager customers. However, she finished shopping before being taken to the hospital and filing a police report (in article below);
"Wal-Mart shoppers who trampled NY worker By Colleen Long, Associated Press Writer – Sat Nov 29"
"2002 and 2008 is probably one of the greatest periods of economic growth in such a short period of time in history"
and I we do is complain about how bad things are.
I do not understand...how does this particular metric measure much vis a vis individual wealth or even income?
How does GDP by itself divided by population indicate how world citizens are doing?
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