In this section, we present the results of real GDP per capita analysis for eleven developed countries: France, Italy, Japan, Netherlands, Spain, Sweden, Switzerland, UK, USA, New Zealand, and Germany. This set includes economies of different sizes, start conditions in 1960, and the rate of growth as represented by the annual increment of real GDP per capita. The period of data coverage is the same as in the previous posts: from 1960 to 2018. The data are borrowed from the Maddison Project Database. The biggest economies, which can be considered as complete is a sense of all principal industries and services developed at a high level (the USA, Japan, the UK, France, Italy, Spain) are characterized by the trend in the annual increment to be close the average increment (dashed red) line or negative (i.e. the linear regression slope is close to 0 or negative). Germany is one of the biggest economies, but it has a reunification history and the accuracy of the joint statistics might be slightly biased.
Some mid-size economies with only several specific sectors of industry and/or services well developed (e.g., Sweden, Switzerland, Netherlands, etc.) may currently have positive trends in the annual GDPpc increment. Instructively, the period of high-speed growth in these successful countries was observed between the mid-1990s and mid-2000s. Between 2008 and 2018, all developed countries slightly underperform. The current economic fall will extend the underperformance period further in the 2020s. The smallest economies are not specifically analyzed here as they are fully controlled by the overall economic conditions and have no opportunity to influence global economic growth. For example, smaller oil-producing countries fully depend on oil prices, which, in turn, are driven by global demand.
Overall, the concept of constant annual GDPpc increment is supported by the MPD data. In the long run, the biggest (complete) developed economies all demonstrate a decaying rate of economic growth as expressed by our model of inertial economic growth of the real GDP per capita. At the same time, these countries are characterized by quite different economic performance as represented by the mean annual increment. For example, the average annual GDPpc increment in the USA is $643 per year (2011 prices) between 1960 and 2018, i.e. every US citizen virtually gets every year by $643 dollars more than in the previous year (we do not discuss the disparity in income distribution in this post). In France, the average increment is only $461 and, in the long run, the US citizens become richer than the French citizens. This difference increases in time but the growth rate of the GDP per capita may be larger in France because the base (GDPpc level) is lower than in the USA. The difference between actual increment and growth rate deceives French people, who may be confused by the rate as the only indicator of real growth.
There are a few developed countries that demonstrate exceptional economic growth in the studied period. We are going to discuss these super successful examples in the next post.
Figure 1. France. The upper panel: the annual GDPpc increment between 1961 and 2018 with the average value for the studied period of $461 (2011 prices). The middle panel: the same annual increment as a function of GDPpc level. The lower panel: the relative growth rate of the GDPpc as a function of the GDPpc.
Figure 2. Same as in Figure 1 for Italy.
Figure 3. Same as in Figure 1 for Japan.
Figure 4. Same as in Figure 1 for the Netherlands.
Figure 5. Same as in Figure 1 for Spain.
Figure 6. Same as in Figure 1 for Sweden.
Figure 7. Same as in Figure 1 for Switzerland
Figure 8. Same as in Figure 1 for the UK.
Figure 9. Same as in Figure 1 for the USA.
Figure 10. Same as in Figure 1 for New Zealand.
Figure 11. Same as in Figure 1 for Germany. The period before 1990, i.e. before the reunification, is characterized by a much lower annual GDPpc increment. Statistics might be slightly biased.
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