Higher rates of per capita growth, such as 5% or 8% per year, represent the experience of rapid growth in economies like Japan, Korea, and China. economy experienced during the strong economy of the late 1990s and into the 2000s. The second highest rate, 3% per year, is close to what the U.S. The slowest rate of GDP per capita growth in the table, just 1% per year, is similar to what the United States experienced during its weakest years of productivity growth. Growth of GDP over Different Time Horizons GDP at starting date × (1 + growth rate of GDP) years = GDP at end dateįor example, an economy that starts with a GDP of 100 and grows at 3% per year will reach a GDP of 209 after 25 years that is, 100 (1.03) 25 = 209. The table then applies the following formula to calculate what GDP will be at the given growth rate in the future: Assume for simplicity that an economy starts with a GDP per capita of 100. Consider Table 1, in which the rows of the table show several different rates of growth in GDP per capita and the columns show different periods of time. Even small changes in the rate of growth, when sustained and compounded over long periods of time, make an enormous difference in the standard of living. ![]() Nothing is more important for increasing people’s standard of living than sustained economic growth.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |