Friday, September 12, 2014

"Will it take 30 years or 300 years for poor countries to catch up to rich ones?"

From Quartz:
If there’s one trend you can count on without fail, it’s that emerging markets out-grow wealthy ones—they’ve got more people, lower labor costs and, thanks to global knowledge and capital flows, access to the expertise and investment needed to drive up productivity to incredible levels. The results have included China’s growth miracle (and a commensurate plunge in extreme poverty), and the BRICS investment craze—as well as plenty of nervous collar-pulling in the wealthy West’s capitals.

But is the most important economic trend of the past decade coming to an end? The chart above shows that the catch-up growth gap between wealthy countries and emerging markets has been shrinking in recent years. The trend is explored this week by the Economist’s Ryan Avent, who used the latest calculations of each country’s relative buying power from the World Bank to directly compare emerging market economic growth to that in wealthy economies....MORE