What the Data Shows
Over on Carpe Diem (Mike Perry) there is a posting showing the data set that supports Tyler Cowen’s arguments that I have supported today in two posts that it is not relative poverty that is the problem, but absolute poverty.
These data show that absolute poverty (no growth) was the norm since 1AD to the 18th century after market driven commerce got under way, since then per capital incomes have grown steadily in the market developing countries. Those countries excluded by protectionism in the developed world (and self-imposed state-management in their own political structures) experience absolute and relative poverty, which is the absence of wealth creation (the annual output of the 'necessaries, conveniences and amusements of life', as Adam Smith expressed it).
Carpe Diem summarises:
"Bottom Line: Sustained economic growth of even 1% per year was not a reality until the 19th century, and sustained economic growth of 2-3% was not a reality until the last 50 years. Putting it in historical perspective, it makes the recent obsession with "income inequality" kind of inconsequential. It could be a lot worse, and was a lot worse throughout human history, for the average person. And complaining about income inequality in a country like the US where per capita GDP is about $42,000, must seem very strange to those in the rest of the world where per capita GDP is only $7500. Kind of like members of an exclusive, private country club complaining about differences in income between the "rich" and "super-rich" member of that club?”
Read the data set at: http://mjperry.blogspot.com/2007/01/economic-growth.html
These data show that absolute poverty (no growth) was the norm since 1AD to the 18th century after market driven commerce got under way, since then per capital incomes have grown steadily in the market developing countries. Those countries excluded by protectionism in the developed world (and self-imposed state-management in their own political structures) experience absolute and relative poverty, which is the absence of wealth creation (the annual output of the 'necessaries, conveniences and amusements of life', as Adam Smith expressed it).
Carpe Diem summarises:
"Bottom Line: Sustained economic growth of even 1% per year was not a reality until the 19th century, and sustained economic growth of 2-3% was not a reality until the last 50 years. Putting it in historical perspective, it makes the recent obsession with "income inequality" kind of inconsequential. It could be a lot worse, and was a lot worse throughout human history, for the average person. And complaining about income inequality in a country like the US where per capita GDP is about $42,000, must seem very strange to those in the rest of the world where per capita GDP is only $7500. Kind of like members of an exclusive, private country club complaining about differences in income between the "rich" and "super-rich" member of that club?”
Read the data set at: http://mjperry.blogspot.com/2007/01/economic-growth.html
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