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Real GDP per capita: global redistribution of economic power

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  • Kitov, Ivan

Abstract

Growth rate of real GDP per capita, GDPpc, is represented as a sum of two components – a monotonically decreasing economic trend and fluctuations related to population change. The economic trend is modelled by an inverse function of GDPpc with a constant numerator which varies for the largest developed economies. In 2006, a statistical analysis conducted for 19 selected OECD countries for the period between 1950 and 2003 showed a very weak linear trend in the annual GDPpc increment for the largest economies: the USA, Japan, France, Italy, and Spain. The UK, Australia, and Canada showed a slightly steeper positive linear trend. The 2012 revision showed that the positive trends became much lower and some of them fell below zero due to the Great Recession. The fluctuations around the trend values are characterized by a quasi-normal distribution with heavy and asymmetric tails. This research revises the previous estimates and extends the set of studied countries by economies in East Europe, Latin America, BRICS, Africa, and Asia including several positive outliers with extremely fast growth. The change in GDP definitions and measuring procedures with time and economic source is discussed in relation to the statistical significance of the trend estimates and data quality requirements for a consistent economic model. The relative performance of all counties since 1960 is compared according to the predicted total GDPpc growth as a function of the initial value. The performance in the 21st century is analyzed separately as revealing potential and actual shifts in the global economic powers.

Suggested Citation

  • Kitov, Ivan, 2021. "Real GDP per capita: global redistribution of economic power," MPRA Paper 105875, University Library of Munich, Germany, revised 07 Feb 2021.
    • Handle: RePEc:pra:mprapa:105875
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    References listed on IDEAS

    as
    1. Kitov, Ivan, 2006. "Real GDP per capita in developed countries," MPRA Paper 2738, University Library of Munich, Germany.
    2. Kitov, Ivan, 2021. "The link between unemployment and real economic growth in developed countries," MPRA Paper 105873, University Library of Munich, Germany, revised 07 Feb 2021.
    3. Ivan Kitov & Oleg Kitov, 2012. "Real GDP per capita since 1870," Papers 1205.5671, arXiv.org.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. On secular relative impoverishment of young people
      by Ivan Kitov in Economics as Classical Mechanics on 2021-04-29 09:58:00
    2. The US economy is on a long-term descent
      by Ivan Kitov in Economics as Classical Mechanics on 2022-09-23 12:55:00

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    More about this item

    Keywords

    economic development; GDP per capita; economic trend; business cycle;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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