Divergence, Big Time
- (pp. 3-17)
AbstractHistorical data are unnecessary to demonstrate that perhaps the basic fact of modern economic history is massive absolute divergence in per capita income across countries. A plausible lower bound on per capita income can be combined with estimates of its current level in the poorer countries to place an upper bound on long-run income growth. Between 1870 and 1990, the ratio of richest to poorest countries' income increased from roughly 9 to 1 to 45 to 1, the standard deviation of (natural log) per capita income doubled, and the average income gap between the richest and all other countries grew nearly tenfold from $1,286 to $12,000.
Citation1997. "Divergence, Big Time." Journal of Economic Perspectives, 11(3): 3-17. DOI: 10.1257/jep.11.3.3
- O47 Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
- N10 Economic History: Macroeconomics and Monetary Economics; Growth and Fluctuations: General, International, or Comparative