April 6, 2019


Economic Growth from Octavian to Obama (Marian L. Tupy, 4/13/18, @HumanProgress) 

As the population of Western Europe recovered, incomes waxed and waned, neither falling to their pre-plague levels, nor rising above their mid-14th century maximum. Thus, as late as 1831, the average GDP per person in France was only $1,534. Put differently, in the 18 centuries that separated the reigns of the first Roman Emperor and the last French king (Louis Phillipe), incomes rose by a paltry 50 percent. The Industrial Revolution, a British import, changed French fortunes considerably. Between 1831 and 1881, incomes rose by 100 percent ($3,067). As such, France made twice as much economic progress in 50 years as it did in the previous 1,800 years. In 2016, French GDP per capita stood at $38,758, meaning that a modern Frenchman is roughly-speaking 24 times better off (in real terms) than his ancestor 200 years ago. Remarkable.

France, of course, was not alone. Similar stories unfolded in other parts of the West.  A year before the Declaration of Independence, American GDP per person stood at $1,883. By the time Barack Obama left office, U.S. GDP per person stood at $53,015 - a 27 fold increase. Today, abundance is no longer restricted to the West. As previously under-developed countries embraced industrialization and trade, they prospered. In 1978, when China started to reform its failing communist economy, its GDP per person stood at $1,583 (French levels in the early 1830s). By 2016, it rose to $12,320 (the French level in 1964). To put that progress in perspective, China grew as much in 38 years, as France did in 130 years. That, too, is noteworthy, for it demonstrates that, given correct policies, countries don't have to reinvent the wheel. They can adopt ideas and technologies that took advanced countries millennia to develop and leapfrog from extreme poverty into the Age of Abundance within a couple of generations.  

Posted by at April 6, 2019 8:34 AM