Real World GDP Through 2030
The chart above of historical real world GDP shares was featured on CD in November and generated lots of discussion (44 comments) and was also featured on Greg Mankiw's blog and about 25 other blogs. Using the same international macroeconomic database from the USDA, the chart below plots the projected shares of real world GDP shares through 2030, and shows the expected change in the composition of world output over the next 20 years as world output is anticipated to increase by 150% from $39 trillion in 2000 to $98.1 trillion by 2030.As expected, the continued economic growth in China and India will boost that region's share of world GDP from the current 25% to 36% by 2030. And most likely within the next few years, the Asia region's share of world GDP will surpass both the USA and EU-15. Also within the next few years, the USA's share of world GDP will exceed the EU-15's share for the first time ever, and the USA-EU-15 gap is expected to widen over the next several decades.
The third chart below shows the projected real world GDP per capita through 2030, which is expected to increase from $6,439 in 2000 (in 2005 dollars) by 84% to $11,875 by 2030. If world GDP increases over the next twenty years as projected, the world economic slowdown in 2009 would be a minor blip on an extended period of economic growth.
9 Comments:
while the first chart is certainly instructive, i suspect that the second chart is pretty meaningless.
it just takes current trends and extrapolates them out 20 years in a straight line.
the world rarely works that way.
remember in the 80's how japan was going to take over?
growth gets harder and harder to come by as you get bigger and more advanced.
a 50% increase in share of world economy in 20 years is just not going to happen
Notice how the "Great Recession" knocked per capita real GDP off course substantially.
Also, the projections show that the line is smooth, but it is quite unreasonable given the ferequency and severity of financial crises.
What has happened over he last few years is not a "once-in-a-lifetime" event. Financial crises are becoming bigger and more frequent.
This country is a slave to the financial system, so the next crisis might just completely destroy us.
--Pingry
So, after two recessions in under ten years, the most recent of which is threatening to literally detonate the PIIGS, we're going to smoothly grow global GDP by 150%+ in twenty years?
That's rich.
I wholeheartedly agree with Morganovich's comment with regards to the second chart. With the third chart being expressed in US dollars, one has to wonder how much it reflects the ongoing devaluation...
Anonymous: "So, after two recessions in under ten years,"
Nothing special about that. The U.S. experienced four recessions from 1921 to 1930, two of which were more severe than this current one.
In the 12 years from 1949 to 1960 - the so-called post-War Boom yeards, the U.S. had four recessions.
We had three recessions in the eight years from Nov-1973 to mid-1981. The last one was as severe as our current one.
anonymous: 'we're going to smoothly grow global GDP by 150%+ in twenty years?"
I don't think anyone expects the growth to be smooth. No one can predict when the next recession will arrive. What's depicted is probably a trend line.
I agree that 150% growth in 20 years seems way too high. It implies an average annual global GDP growth of 4.7%. I could only find three years in the past 40 when global GDP growth was that high.
The U.S. economy is far more advanced than the charts suggest, the E.U. economy has lagged the U.S. badly, while Asia is only catching-up.
Roughly half of the world's Information-Age firms are American (in revenues and profits), and roughly three-quarters of the world's Biotech-Revolution firms are American.
The world order:
1. The U.S. masses receive free goods from the global economy in exchange for policing the world.
2. The E.U. masses receive the illusion of prosperity for being anti-war.
3. The Asian masses receive employment for political stability.
Anti-war Americans want the goods without paying for them.
Also, I may add, "Obamanomics" has rather than promoted growth and taxed it, has stunted growth, for perhaps the next 10 years.
After that, the 80 million U.S. Baby-Boomers will retire, and U.S. workers will have to provide the Social Security and Medicare, along with other goods & services, the retired Boomers will consume.
I thought the projections would look more like a ball of yarn than the smooth continued trends provided.
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