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Chapter 18 Long-Term Economic Growth Print Edition at 70% with .01 margins Our Economics Learning Center has information for students, teachers, an professionals. |
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I.
How the Government Dealt With Past Recessions
from the
The
New York Times II. Analyzing recent economic growth A. Measurement will be in nominal, real, and per capita amounts. B. Real per capita Gross Domestic Product, Disposal Personal Income, Total Private Wages, Manufacturing Wages and spending on Social Security, Medicare, and Medicaid will be studied. C. Rapid growth policies have costs to society 1. Pollution 2. Harried lifestyle 3. Neglected worker safety 4. Increased litigation D. Interesting Sites 1. Industrial Revolution and the Standard of Living by Clark Nardinelli 2. The First Measured Century Ben Wattenberg's classic is a must for those interested in the economic history of the 20th century. 3. The Escape from Hunger and Premature Death, 1700-2100” by Robert William Fogel. Cambridge University Press, 2004. 4. annual report on income, poverty and health insurance Census Bureau’s |
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Real Per Capita Growth in GDP and DPI
1929-2010 |
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1962 | 1970 | 1980 | 1990 | 2000 | 2010p | |
| Populations (millions) | 187 | 205 | 228 | 250 | 282 | 310 | |
| GDP Current Dollars (billions) Table B1 | $586 | 1,038 | 2,788 | 5,800 | 9,951 | 14,660 | |
| GDP Per Capita -Current Dollars1 | $3,134 | 5,063 | 12,228 | 23,200 | 35,287 | 47,290 | |
| GDP Chained 2005 (Billions) | $3,072 | 4,270 | 5,839 | 8,034 | 11,226 | 13,249 | |
| % Increase in Real GDP Chain 2005 $1 | 39.0% | 37.0% | 37.6% | 40.0% | 18.0% | ||
| DPI - Current Dollars (billions) B30 | $405 | 736 | 2,003 | 4,254 | 7,327 | 11,378 | |
| DPI Per Capita -Chained 2005 B31 | $11,413 | 15,158 | 18,863 | 23,568 | 28,889 | 33,019 | |
| Median Money family
income Chained 2009 dollars 1999, 2009 B33 |
$62,860 | 60,088 | |||||
| DPI Absolute Increase in Real Per Capita1 | $3,745 | 3,705 | 4,705 | 5,321 | 4,130 | ||
| 1 Editors Calculations: During the last decade, median family income went down by $2,772 but DPI/person went up $4,130 in less valuable 2005 chained dollars. For a family of four, we are missing 4X$4,130 + 27,72 = $19,992. It went to the top1%. | |||||||
| 2. View Bradford DeLong's( USC Berkley) dynamic presentation of. GDP growth since 1900. | |||||||
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Private and Manufacturing Actual and Real Hourly Wages 1960 -2010 |
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| 1970 | 1980 | 1990 | 2000 | 2010 | |
| Total Private Hourly, actual dollars | $3.40 | $6.85 | $10.20 | $14.02 | $19.04 |
| Manufacturing, actual dollars | 3.23 | 7.15 | 10.78 | 14.32 | 18.57 |
| Total Private, 1982-84 dollars | 8.72 | 8.26 | 7.91 | 8.30 | 8.90 |
| Manufacturing, 1982-84 dollars | 8.28 | 8.62 | 836 | 8.48 | 8.68 |
| Difference between Private-Manufacturing, 1982-84 dollars | +$.44 | -.36 | -.46 | -.18 | +.22 |
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Experts Say
Growth
Medicare Spending Is Out Of Control |
II. Determinants of growth A. Quantity and quality of natural and human resources B. Quantity and quality of capital goods C. Development and application of technology D. Efficiency of economic system 1. Maintaining reasonable, consistent growth in Aggregate Demand (not having recessions or excessive inflation) 2. Efficient allocation and use of economic resources E. The latest edition of Economics by McConnell and Brue provide this data on U.S. Growth Competitiveness. F. The latest edition of Economics by McConnell and Brue provide this data on U.S. education. |
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| Social Security | Medicare | Medicaid | |||||||
| 1970 | 29.61 | 6.8 | 2.7 | ||||||
| 2003 | 470.6 | 274.2 | 160.7 | ||||||
| 1 Billions of Dollars | |||||||||
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The Real Story--Spending As A Percentage Of Gross Domestic Product |
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| Defense | International (Foreign Aid) |
Social Security | Medicare | Medicaid |
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| 1970 | 8.1 | 0.04 | 2.9 | 0.7 | 0.3 | ||||
| 1980 | 4.9 | 0.5 | 4.3 | 1.2 | 0.5 | ||||
| 1990 | 5.2 | 0.3 | 4.3 | 1.9 | 0.7 | ||||
| 2000 | 3.0 | 0.2 | 4.2 | 2.2 | 1.2 | ||||
| 2003 | 3.7 | 0.3 | 4.3 | 2.5 | 1.5 | ||||
| Percent Point Change | 3.7-8.1 = -4.4 | 0.3-0.4=-0.1 | 4.3 - 2.9 = 1.4 | 2.5-0.7 =1.8 | 1.6-0.3 = 1.2 | ||||
| Combined Change |
-4.4 + (-0.1)= -4.5 |
1.4 + 1.8 + 1.2 = 4.4 |
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| Note that social
security has not gone up because retirement age was delayed in the early
1980's and the same thing will happen to Medicare. Medicaid is the price we pay for not having socialized medicine. |
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In the early 1960's, they were predicting Russia was passing US USSR Growth History
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Then in the 80's it was Japan.
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Then it was the European Union. "Although customs duties disappeared in 1968, trade is not flowing freely across EU borders. The main obstacles are differences in national regulations. The Single European Act of 1986 launches a vast six-year program to sort these out. The Act also gives the European Parliament more say and strengthens EU powers in environmental protection". |
Now its China! |
| III. The
Job Outlook based on education A. and jobs from 2004-14 Job outlook by education Olivia Crosby and Roger Moncarz 1. don’t have a bachelor’s degree 
Nutshell
Snippet
PDF 2. college graduates
Nutshell
Snippet
PDF
3. Summary
of the BLS 2004-2114 Job outlook by education for college graduates |
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IV. Is slow economic growth a problem for the United States
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Measurement |
Output Growth |
Inflation |
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Country |
1950-70 |
1970-91 |
1950-70 |
1970-91 |
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United States |
2.8 |
2.1 |
2.4 |
6.2 |
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Japan |
9.2 |
4.4 |
4.9 |
5.5 |
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West Germany |
6.3 |
2.5 |
2.2 |
3.8 |
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Canada |
4.9 |
3.5 |
2.5 |
6.9 |
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United Kingdom |
3.6 |
2.4 |
3.7 |
10.0 |
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France |
5.3 |
2.7 |
4.9 |
7.8 |
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Italy |
5.7 |
3.0 |
3.5 |
11.7 |
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Average |
5.4 |
2.9 |
3.5 |
7.4 |
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Our Tutors Accounting
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1. By 2001 Alan Greenspan, chair of the Federal
Reserve, worried that the high productivity and paying off the federal
debt too
fast could have unforeseen economic repercussions.
2. Interesting, as indicted at the beginning of this
chapter, recent productivity
increases didn't translate into increased economic growth.
3. By 2006, some studies were
indicating that recent growth rates may have been overstated.
4.
The lost decade
shows how growth has been slow for a
while. Comments are very interesting. 08/20/09
IV.
Cycles:
Some empirical issues show that long term can be a long time.
V. The world is Flat and growth prospects are limited.
A. Tradable
Jobs 8/1/11 from http://www.economicpopulist.org/
... "f the 27.3 million jobs
added from this time period, 97.7% of them were non-tradable.
What do the
authors mean by tradable jobs? Jobs that can be offshore
outsourced." ...
"As an
example, health care must be domestically sourced because sick people are here.
Computer architecture, on the other hand, can be offshore outsourced and the
results
moved
around the globe to a manufacturing center."
B
VI Trade Ruler: is a digital game using trade to increase growth.
VII. Our Economics Learning Center has information for students, teachers, an professionals.
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