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Losing Control: The Emerging Threats to Western Prosperity by Stephen D. King
Admiral Zheng, asset-backed security, barriers to entry, Berlin Wall, Bernie Madoff, Bretton Woods, BRICs, British Empire, capital controls, Celtic Tiger, central bank independence, collateralized debt obligation, corporate governance, credit crunch, crony capitalism, currency manipulation / currency intervention, currency peg, David Ricardo: comparative advantage, demographic dividend, demographic transition, Deng Xiaoping, Diane Coyle, Fall of the Berlin Wall, financial deregulation, financial innovation, fixed income, Francis Fukuyama: the end of history, full employment, George Akerlof, German hyperinflation, Gini coefficient, hiring and firing, income inequality, income per capita, inflation targeting, invisible hand, Isaac Newton, knowledge economy, labour market flexibility, labour mobility, liberal capitalism, low skilled workers, market clearing, Martin Wolf, mass immigration, Mexican peso crisis / tequila crisis, Naomi Klein, new economy, old age dependency ratio, Paul Samuelson, Ponzi scheme, price mechanism, price stability, purchasing power parity, rent-seeking, reserve currency, rising living standards, Ronald Reagan, savings glut, Silicon Valley, Simon Kuznets, sovereign wealth fund, spice trade, statistical model, technology bubble, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Market for Lemons, The Wealth of Nations by Adam Smith, Thomas Malthus, trade route, transaction costs, Washington Consensus, women in the workforce, working-age population, Y2K, Yom Kippur War
In these circumstances, it’s relatively easy for those in work to support those at either end of the age spectrum. Such was the case in the UK in the nineteenth century and in East Asia over the last fifty years. High rates of economic growth per capita were partly led by productivity, but also supported by the demographic dividend. The demographic dividend is like a surfer’s wave. The wave lifts the surfer high up, it provides a moment of excitement in the surfer’s life but, eventually, it fades away. Demographic dividends don’t occur quite so frequently as the surfer’s wave but they have a similar effect: they temporarily raise the growth rate of an economy. Unlike surfers’ waves, though, they can persist for many decades. If handled well, they can help create a virtuous economic circle. Improved healthcare for infants increases their chances of survival and, as a result, women choose to have fewer babies.
Half a century later, the population had more than doubled. DEMOGRAPHIC DIVIDENDS AND DEFICITS These numbers, although impressive, say little about the economic consequences of demographic change. Ever since Thomas Malthus first wrote his Essay on the Principle of Population, there has been a heated debate over whether changes in population size are bad for welfare (the Malthusian subsistence argument), good for welfare (what might be termed the human ingenuity argument) or entirely neutral for welfare (the income per capita rather than total income argument). Yet each of these positions misses the main economic point. Demographic change is significant because age structures change. In any one country, it’s possible to experience both a demographic dividend and a demographic deficit. The dividend occurs when the population of working age is large in relation to the population of non-working age.
A more likely explanation, in my view, is that Latin American economies had major problems with property rights, inflation and openness, thereby reducing incentives both to save and to trade.4 For the developed world, the problem is not so much the inability to jump onto a demographic wave but, instead, working out what to do when it’s time to jump off. No longer are these nations benefiting from a demographic dividend. Instead, their leaders should be worrying about a demographic deficit. The quandary is best expressed through the use of ‘dependency ratios’, defined as the ratio of the sum of the population aged between zero and fourteen (below working age) and that aged sixty-five and above (retirees) to the population aged between fifteen and sixty-four. While the demographic dividend is at work, the dependency ratio declines. As the wave crests, the ratio begins to rise, signalling the threat of a demographic deficit. Figure 8.1 shows movements in dependency ratios for nations and regions within the developed world compared with the global average.
Imagining India by Nandan Nilekani
affirmative action, Airbus A320, BRICs, British Empire, business process, business process outsourcing, call centre, clean water, colonial rule, corporate governance, cuban missile crisis, deindustrialization, demographic dividend, demographic transition, Deng Xiaoping, digital map, distributed generation, farmers can use mobile phones to check market prices, full employment, ghettoisation, glass ceiling, global supply chain, Hernando de Soto, income inequality, informal economy, Intergovernmental Panel on Climate Change (IPCC), joint-stock company, knowledge economy, labour market flexibility, land reform, light touch regulation, LNG terminal, load shedding, Mahatma Gandhi, market fragmentation, mass immigration, Mikhail Gorbachev, Network effects, new economy, New Urbanism, open economy, Parag Khanna, pension reform, Potemkin village, price mechanism, race to the bottom, rent control, rolodex, Ronald Reagan, school vouchers, Silicon Valley, smart grid, special economic zone, The Wealth of Nations by Adam Smith, Thomas L Friedman, Thomas Malthus, transaction costs, trickle-down economics, unemployed young men, upwardly mobile, urban planning, urban renewal, women in the workforce, working poor, working-age population
Improved health care, for instance, caused the early dividends in Europe and Britain, since this resulted in significant drops in infant deaths. This is also true for developing countries—in India, health progress has triggered its dividend.”m In developed countries, with their already low mortality and fertility rates, a demographic dividend was rare and indicated an unusual event. That event was usually a war. The Second World War—which forced people to postpone having children, and then have them all together in one big wave—led to a baby boom and demographic dividend in the United States. Here, the postwar dividends enabled rapid growth, and it contributed to an estimated 20 percent of GDP growth between 1970 and 2000. In Ireland it was the legalization of birth control that fueled its demographics—there were few infant deaths, but when this deeply Catholic country finally legalized contraceptives in 1979, Ireland’s high fertility rate began to fall rapidly.
Which brings us to the question—where are the young now? In the 1970s, two very large economies were yet to experience a demographic dividend: India and China. The dividends of an autocracy, versus a democracy As early as 1938, India’s National Planning Committee had made a statement on population that was an echo of the idea China championed in the 1970s: “The importance of deliberately controlled numbers [in population],” it said, “cannot be exaggerated in a planned economy.”21 As it turned out, this idea was unworkable in democratic India, even as it took off successfully in China. In terms of implementing policies that are good for you, whether you like it or not, autocratic regimes are far better than democracies. In the age of the demographic dividend, however, China’s highly effective family planning policy has looked like a case of winning the battle, but perhaps losing the war.
In its strengths, India is a jigsaw piece that is falling perfectly into place in the landscape of the global economy. The single biggest advantage in this context is India’s demographic dividend, which is well-known thanks to the landmark Goldman Sachs BRICs report that came out in 2003. I discuss this demographic opportunity with Roopa Purushothaman, the brilliant and precocious economist—she was twenty-five at the time of the BRICs analysis—who coauthored the report. “We didn’t realize at the time the impact these projections would have,” Roopa tells me, “but the report created waves, and it drew a lot of attention to the potential effects of India’s demographic dividend.” It certainly did—I remember the somewhat premature blowing of trumpets across India when the report was released, and it formed the basis of the ill-fated “India Shining” campaign that the NDA government, up for reelection, launched.
3D printing, Asian financial crisis, backtesting, bank run, banking crisis, Berlin Wall, Bernie Sanders, BRICs, business climate, business process, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, centre right, colonial rule, Commodity Super-Cycle, corporate governance, creative destruction, crony capitalism, currency peg, dark matter, debt deflation, deglobalization, deindustrialization, demographic dividend, demographic transition, Deng Xiaoping, Doha Development Round, Donald Trump, Edward Glaeser, Elon Musk, eurozone crisis, failed state, Fall of the Berlin Wall, falling living standards, Francis Fukuyama: the end of history, Freestyle chess, Gini coefficient, hiring and firing, income inequality, indoor plumbing, industrial robot, inflation targeting, Internet of things, Jeff Bezos, job automation, John Markoff, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, labor-force participation, liberal capitalism, Malacca Straits, Mark Zuckerberg, market bubble, mass immigration, megacity, Mexican peso crisis / tequila crisis, mittelstand, moral hazard, New Economic Geography, North Sea oil, oil rush, oil shale / tar sands, oil shock, pattern recognition, Paul Samuelson, Peter Thiel, pets.com, Plutocrats, plutocrats, Ponzi scheme, price stability, Productivity paradox, purchasing power parity, quantitative easing, Ralph Waldo Emerson, random walk, rent-seeking, reserve currency, Ronald Coase, Ronald Reagan, savings glut, secular stagnation, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Simon Kuznets, smart cities, Snapchat, South China Sea, sovereign wealth fund, special economic zone, spectrum auction, Steve Jobs, The Future of Employment, The Wisdom of Crowds, Thomas Malthus, total factor productivity, trade liberalization, trade route, tulip mania, Tyler Cowen: Great Stagnation, unorthodox policies, Washington Consensus, WikiLeaks, women in the workforce, working-age population
In a few other populous countries, the number of working-age people is growing at a rate near or above 2 percent, including the Philippines and some emerging countries with economies too small to make the top twenty, such as Kenya, Nigeria, Pakistan, and Bangladesh. These populations are also forecast to keep growing rapidly for the next decade, so they have a demographic edge on the competition. For them, the trick is to avoid falling for the fallacy of the “demographic dividend,” the idea that population growth pays off automatically in rapid economic growth. It pays off only if political leaders create the economic conditions necessary to attract investment and generate jobs. In the 1960s and ’70s, rapid population growth in Africa, China, and India led to famines, high unemployment, and civil strife. Rapid population growth is often a precondition for fast economic growth, but it never guarantees fast growth.
There between 1985 and 2005 the working-age population grew by an average annual rate of more than 3 percent, or nearly twice as fast as the rest of the world. But no economic dividend resulted. In the early 2010s many Arab countries suffered from cripplingly high youth unemployment rates: more than 40 percent in Iraq and more than 30 percent in Saudi Arabia, Egypt, and Tunisia, where the violence and chaos of the Arab Spring began. In India, where hopes for the demographic dividend have also been sky high, ten million young people will enter the workforce each year over the next decade, but lately the economy has been creating less than five million jobs annually. Though discussions of rapid population growth tend to focus on big emerging countries, a rising number of workers is also critical to economic growth in developed countries. In recent decades, the United States has come to see itself as by far the most dynamic and flexible of the developed economies, far more innovative than Europe, far less hidebound than Japan.
In recent years countries with faster-growing populations have also tended to exhibit faster productivity growth. As the dependency ratio declines, with more people entering the workforce and earning an independent living, a country’s income increases, and that creates a greater pool of capital, which can be used to invest in ways that further raise productivity. According to the demographer Andrew Mason, this secondary demographic dividend was an important boost to the economic growth rates of East and Southeast Asia, where saving rates are relatively higher and the workforce has been relatively large.5 Furthermore, a more experienced labor force also tends to be more productive. The best-positioned countries are those taking steps to keep older people in the workforce and out of the “dependent” population. In 2007, Germany increased the retirement age from 65 to 67 for men and women, a measure that will be phased in gradually.
Breakout Nations: In Pursuit of the Next Economic Miracles by Ruchir Sharma
3D printing, affirmative action, Albert Einstein, American energy revolution, anti-communist, Asian financial crisis, banking crisis, Berlin Wall, BRICs, British Empire, business climate, business process, business process outsourcing, call centre, capital controls, Carmen Reinhart, central bank independence, centre right, cloud computing, collective bargaining, colonial rule, corporate governance, creative destruction, crony capitalism, deindustrialization, demographic dividend, Deng Xiaoping, eurozone crisis, Gini coefficient, global supply chain, housing crisis, income inequality, indoor plumbing, inflation targeting, informal economy, Kenneth Rogoff, knowledge economy, labor-force participation, labour market flexibility, land reform, M-Pesa, Mahatma Gandhi, Marc Andreessen, market bubble, mass immigration, megacity, Mexican peso crisis / tequila crisis, new economy, oil shale / tar sands, oil shock, open economy, Peter Thiel, planetary scale, quantitative easing, reserve currency, Robert Gordon, Shenzhen was a fishing village, Silicon Valley, software is eating the world, sovereign wealth fund, The Great Moderation, Thomas L Friedman, trade liberalization, Watson beat the top human players on Jeopardy!, working-age population, zero-sum game
India now risks falling for its own hype, based largely on the assumption that it is again performing a trick pioneered by China—a seemingly endless stretch of 8 to 9 percent growth—and is therefore destined to be the fastest-growing economy over the next decade. At least until the last months of 2011, when growth forecasts dipped below 7 percent and rattled investor confidence, the Indian elite seemed more focused on how to spend the windfall than on working to make sure the rapid growth actually happens. The best example of this rosy thinking was the way the ongoing baby boom in India has been transformed from a “time bomb” into a “demographic dividend” in the minds of the elite. Until the 1990s the Indian government was still working hard to rally the nation against the dangers of overpopulation, but that fear has melted away, based on the argument that a baby-boom generation of new workers helped fuel China’s rise and will do the same for India. Indeed China’s baby boom is about to end—the “dependency ratio” of old pensioners to the young workers who support them is expected to start growing sharply in 2015—while India’s baby boom still has legs.
The catchiest advertising jingle of the decade was a public-service ditty that went like this: “After one, not now. After two, never again.” People could not get that song, which rhymes neatly in Hindi, out of their heads. In the last decade, however, the government dropped this theme, and the overwhelming consensus holds that population growth means more workers who can drive economic growth. The shelves of Indian libraries groan with research reports that argue for the inevitable wonders of this demographic dividend, citing the Chinese example as precedent, but ignoring the huge challenge of educating all the young people and expanding the job opportunities available to the ten million entering the labor force every year. Yes, a growing pool of young workers can be a huge advantage, but only if a nation works hard to set them up for productive careers. A recent survey by the consulting firm Aon Hewitt shows that salaries of urban workers are rising faster in India than anywhere else in Asia, with average wages increasing by nearly 13 percent in 2011—a symptom of the fact that when so few workers are highly skilled, those who are can charge a premium.
A recent survey by the consulting firm Aon Hewitt shows that salaries of urban workers are rising faster in India than anywhere else in Asia, with average wages increasing by nearly 13 percent in 2011—a symptom of the fact that when so few workers are highly skilled, those who are can charge a premium. The growth in demographic analysis as a global industry is striking. I can’t count the number of demographers who have come to my offices in recent years, all offering some spin on the basic idea that population growth drives economic growth, and proffering tips on which nations will enjoy the biggest “demographic dividend.” These fads come and go on Wall Street. In the 1970s and 1980s, every investment house had its own political economist, as a kind of coup and war forecaster, but they were gradually phased out in the 1990s as wars became more localized and political stability spread in the developing world. For now the demographers rule, and they love to talk about India. Consulting trends like these should be treated with the amused detachment they deserve, and the knowledge that this fad, too, shall pass.
Britannia Unchained: Global Lessons for Growth and Prosperity by Kwasi Kwarteng, Priti Patel, Dominic Raab, Chris Skidmore, Elizabeth Truss
Airbnb, banking crisis, Carmen Reinhart, central bank independence, clockwatching, creative destruction, Credit Default Swap, demographic dividend, Edward Glaeser, eurozone crisis, fear of failure, glass ceiling, informal economy, James Dyson, Kenneth Rogoff, knowledge economy, long peace, margin call, Mark Zuckerberg, Martin Wolf, megacity, Mexican peso crisis / tequila crisis, Neil Kinnock, new economy, North Sea oil, oil shock, open economy, pension reform, price stability, profit motive, Ronald Reagan, Sand Hill Road, Silicon Valley, Steve Jobs, Walter Mischel, wealth creators, Winter of Discontent, working-age population, Yom Kippur War
While the number of teenage mothers or those in their twenties has fallen, the number of babies born to the over-40s has tripled in the past 30 years.60 In the last ten years alone, the number of births to the over-30s has gone up by 22 per cent.61 As the whole world ages, Britain will remain a relatively young country. Past experience suggests that this can only be healthy. More young people means more minds to create new ideas and generate wealth, more opportunities and creativity, and more help to look after the old. Much of the growth of the mid twentieth century across the world came from a ‘demographic dividend’, as the population surge from the baby boomers reached the workplace and helped drive the rest of the economy. Imagine the experience of someone born and growing up in the internet age. They are at ease in a globalised world, as used to discussing last night’s TV with friends from Hong Kong as Hereford. Twitter doesn’t care what country you come from, or ‘Call of Duty’ where your fellow ‘soldiers’ are really located.
Index Compiled by Sue Carlton 9/11 terrorist attacks 29 Addison Lee minicabs 62, 63 Airbnb 98 Allensbach Institute 40 America see United States Amin, Idi 9 antisemitism 86 Antrobus, Lavern 75 AOL 81 Apple 60, 81, 91, 105 The Apprentice 75 apprenticeships 74 ArcelorMittal 73 Argentine military junta, defeat of (1982) 10 ARM 68 austerity measures 3, 36, 66 Australia 30, 32–3, 65, 88, 111 Bakewell, Joan 109–10 Balls, Ed 25–6, 27, 28, 29, 30, 31, 33 Balls, Michael 25 Bank of England independence 25 see also central banks bankruptcy 91, 92 see also business, and failure banks Australian 33 bailouts 12, 33 Canadian 4, 13, 33–5 Chinese 95 and mathematical knowledge 45, 47–8 Bar-Natan, Bernard 78–80, 84 Basel II regulations 47 Beleza Natural 103–4 Beuchler, Simone 102 Black Wednesday 25 Blair, Tony 17, 24, 27, 29, 115 Blanchﬂower, David 20 boom and bust, end of 25, 27, 30, 115 Branson, Richard 97 Brazil 5, 100–6, 112, 113, 115 crime 102–3, 105 democratic elections 104 demographics 104 education system 105 and global recession 101 and international investment 105 military coups 104 Olympic Games (2016) 101–2, 103 and optimism 5, 100–2, 103, 105, 106, 111 poverty and inequality 102, 104–5 productivity 105, 115 BRIC (Brazil, Russia, India, China) economies 10 see also emerging economies Britain see United Kingdom British Chamber of Commerce survey (2011) 87 British ﬁlm industry 97 British Social Attitudes survey 109 Brittan, Samuel 20 Brown, Gordon 17, 24, 25, 26–9, 30, 33, 36 Buckley, Sir George 58 business 2, 3–4 enterprise zones 88 and failure 91–2, 95–6, 99 and informal economy 88–9 and regulation 87–8, 89 Callaghan, James 24, 114 Cameron, David 20 Campbell, Kim 16 137 138 Britannia Unchained Canada 4, 12, 13–19, 32, 33–7 banks 4, 13, 33–5 cutting deﬁcits 4, 14–18, 30, 32, 37 diversiﬁed economy 34 education 36, 37 ﬁnancial regulation 34–5 points-based immigration system 36 spending cuts 17–18 CDOs (collateralised debt obligations) 47, 48 CDSs (credit default swaps) 47 celebrity culture 4, 74–5, 76, 115 central banks independence 25, 27 see also Bank of England Centre for Economics and Business Research 101 Centre for Social Justice 67, 70, 73 Charles II, King of England 21 childcare, cost of 71 Chile 30, 32 China 10, 46, 53, 113, 115 aging population 106, 107 education 43, 44, 113 Chinese students in UK 58–9, 72 enterprise culture 95 informal economy 89 patent registration 54 Chrétien, Jean 16–18, 35, 36 chutzpah 81–2 Cidade de Deus slum 100 City of God (2002) 100 Clark, Joe 15 Clarke, Ken 27–8 Clinton, Bill 25 ComRes poll 87 Confederation of British Industry 74 Conservative Party (Canada) 35 consumer law 89 Cool Britannia 10, 115 Costa, Edivan 103 credit card debt 12, 30 Crosland, Anthony 26 Crow, Bob 63 Crowdcube 98 crowdfunding 98 Darling, Alistair 111 Day Care Trust 71 De Gaulle, Charles 8, 105–6 Deak, Lex 92 debt 10, 12, 19–24, 30–3, 115 debt delusion 19–20, 23 and default 21–2, 101 and economic growth 21, 22, 23–4 and ﬁnancial crises 22–3 and future generations 67, 70 and responsible spending 24, 33 deﬁcits 23–4 see also United Kingdom (UK), and deﬁcit; Canada, cutting deﬁcits; debt delayed gratiﬁcation 71–2 demographics 106–11 population aging 32, 100, 101, 106–7 population growth 9, 113 Devey, Hilary 75–6 Dickson, Julie 35 Diefenbaker, John 15 dot com bubble 11, 29, 94 Dragons’ Den 75 Duncan, Arne 38 Duncan, Emma 57 Duncan-Smith, Iain 75 Dyson, , James 97 Economic Freedom of the World (Cato Institute) 36 economic growth 113 and demographic dividend 108 unsustainability of 9, 10 Economic Stabilisation Plan (Israel) 83 Edison, Thomas 91 education 4–5, 38–60 comparing school systems 38–41 cramming establishments 43–4 and graduate jobs market 44–5 and hard work 50, 57, 59 Index and parental aspiration 57, 59, 72–3 students choosing easier subjects 42–3, 45, 46–7 and work experience 43, 74 see also United Kingdom (UK), education; Programme for International Student Assessment (PISA) Edward III, King of England 21 emerging economies 3, 11, 113, 115 and scientiﬁc development 52, 53 and women 50 see also Brazil; China; India; Mexico; South Korea Enron 92 enterprise zones 88, 94 entrepreneurship Brazilian shantytowns 103–4 and courage 98–9 in US 90, 93–4, 96–7 and work ethic 67–8 see also Israeli entrepreneurial culture Erlich, Yigal 83, 84–5 Eurozone crisis 3, 12, 21, 37, 114 Exchange Rate Mechanism 24–5, 115 Facebook 55, 76, 95 failure as part of business 91–2, 95–6, 99 see also risk Famine, 1975!
The Rational Optimist: How Prosperity Evolves by Matt Ridley
23andMe, agricultural Revolution, air freight, back-to-the-land, banking crisis, barriers to entry, Bernie Madoff, British Empire, call centre, carbon footprint, Cesare Marchetti: Marchetti’s constant, charter city, clean water, cloud computing, cognitive dissonance, collateralized debt obligation, colonial exploitation, colonial rule, Corn Laws, creative destruction, credit crunch, David Ricardo: comparative advantage, decarbonisation, dematerialisation, demographic dividend, demographic transition, double entry bookkeeping, Edward Glaeser, en.wikipedia.org, everywhere but in the productivity statistics, falling living standards, feminist movement, financial innovation, Flynn Effect, food miles, Gordon Gekko, greed is good, Hans Rosling, happiness index / gross national happiness, haute cuisine, Hernando de Soto, income inequality, income per capita, Indoor air pollution, informal economy, Intergovernmental Panel on Climate Change (IPCC), invention of agriculture, invisible hand, James Hargreaves, James Watt: steam engine, Jane Jacobs, John Nash: game theory, joint-stock limited liability company, Joseph Schumpeter, Kevin Kelly, knowledge worker, Kula ring, Mark Zuckerberg, meta analysis, meta-analysis, mutually assured destruction, Naomi Klein, Northern Rock, nuclear winter, oil shale / tar sands, out of africa, packet switching, patent troll, Pax Mongolica, Peter Thiel, phenotype, Plutocrats, plutocrats, Ponzi scheme, Productivity paradox, profit motive, purchasing power parity, race to the bottom, Ray Kurzweil, rent-seeking, rising living standards, Silicon Valley, spice trade, spinning jenny, stem cell, Steve Jobs, Steven Pinker, Stewart Brand, supervolcano, technological singularity, The Wealth of Nations by Adam Smith, Thorstein Veblen, trade route, transaction costs, ultimatum game, upwardly mobile, urban sprawl, Vernor Vinge, Vilfredo Pareto, wage slave, working poor, working-age population, Y2K, Yogi Berra, zero-sum game
p. 326 ‘opportunities to the poor of Africa that were not available to the poor of Asia a generation ago’. Rodrik, D. (ed.). 2003. In Search of Prosperity. Princeton University Press. p. 327 ‘a study of the sardine fishermen of Kerala in southern India’. Jensen, Robert T. 2007. The digital provide: information (technology), market performance and welfare in the South Indian fisheries sector. Quarterly Journal of Economics 122: 879–924. p. 328 ‘demographic dividend’. Bloom, D.E. et al. 2007. Realising the Demographic Dividend: Is Africa Any Different? PGDA Working Paper no. 23, Harvard University. p. 328 ‘charter city in Africa’. www.chartercities.com. p. 329 ‘The weather is always capricious’. Newsweek, 22 January 1996. On the web at http://www.newsweek.com/id/101296/page/1. p. 329 ‘Meteorologists disagree about the cause and extent’. Newsweek, 28 April 1975. On the web at http://www.denisdutton.com/cooling_world.htm.
A handwritten contract between two people in Tanzania may be affordable and enforceable, but it is little help if the debtor wishes to start an export business supplying cut flowers to a London-based supermarket. Of course, it will not all be easy or smooth, but I refuse to be pessimistic about Africa when such an opportunity is available at a few strokes of a pen and when the evidence of entrepreneurial vitality in the extralegal sector is so strong. Besides, as its population growth rates fall, Africa is about to reap a ‘demographic dividend’ when its working-age population is large relative to both the dependent elderly and the dependent young: such a demographic bonanza gave Asia perhaps one third of its miracle of growth. The key policies for Africa are to abolish Europe’s and America’s farm subsidies, quotas and import tariffs, formalise and simplify the laws that govern business, undermine tyrants and above all encourage the growth of free-trading cities.
The Great Surge: The Ascent of the Developing World by Steven Radelet
Admiral Zheng, agricultural Revolution, Asian financial crisis, bank run, Berlin Wall, Branko Milanovic, business climate, business process, call centre, Capital in the Twenty-First Century by Thomas Piketty, clean water, colonial rule, creative destruction, demographic dividend, Deng Xiaoping, Dissolution of the Soviet Union, Doha Development Round, Erik Brynjolfsson, European colonialism, F. W. de Klerk, failed state, Francis Fukuyama: the end of history, Gini coefficient, global supply chain, income inequality, income per capita, Intergovernmental Panel on Climate Change (IPCC), invention of the steam engine, James Watt: steam engine, John Snow's cholera map, Joseph Schumpeter, Kenneth Arrow, land reform, low skilled workers, M-Pesa, megacity, Mikhail Gorbachev, off grid, oil shock, out of africa, purchasing power parity, race to the bottom, randomized controlled trial, Robert Gordon, Second Machine Age, secular stagnation, Simon Kuznets, South China Sea, special economic zone, Steven Pinker, The Wealth of Nations by Adam Smith, Thomas Malthus, trade route, women in the workforce, working poor
China also is moving slowly from importing other countries’ technologies to becoming more of an innovator in developing technologies itself—an important shift for long-term growth, but one that tends to translate into slower growth rates, since this is harder and more costly than simply adopting someone else’s ideas. Third, China’s changing demography will begin to work against it. Over the last few decades, China has enjoyed the benefits of a “demographic dividend.” A large share of its population has been of working age, with a smaller share of children and senior citizens. Economic growth is faster when more people are working and there are fewer nonworking dependents. As China’s population ages, there will be fewer workers relative to dependents. As a result, its growth rate per person will slow. The deceleration from spectacular growth is what happened to Japan in the 1980s and 1990s and, more recently, has begun to take hold in South Korea, Taiwan, Botswana, and other countries that surged ahead a few decades ago.
Henry), 97 Cairo, 206, 216 California, 281 call centers, 56, 178, 262 Cambodia, 11, 36, 106, 114, 159 camels, 152 Cameroon, 281 Canada, 47, 210, 231 Cape Town, University of, 247 capitalism, 122, 146, 147–48, 149, 156, 162, 163, 250, 264, 303 in Asia, 155–57 Capital in the Twenty-First Century (Piketty), 68–69 capital markets, 164 carbon dioxide, 278, 282 carbon emissions, 297 Cardoso, Fernando, 186–87 Caribbean, 36 Carnation Revolution, 105 Carothers, Thomas, 112 Case Studies in Global Health, 214 cash transfer programs, 38 cassava, 171, 215 Castro, Fidel, 100, 144 Catholicism, 120–21, 123 cattle plague, 215 CD4 cell count, 175 Ceauşescu, Nicolae, 143 Center for Global Development, 298 Center for Systemic Peace, 107 Centers for Disease Control and Prevention (CDC), US, 210 Central Africa, 205 Central African Republic, 49, 50, 222 Central America: crime in, 264 megacities in, 277 wars in, 81, 141 Central Asia, 36, 141, 147 Central Bank, Gambia, 190 Central Military Commission, 134 Chad: child mortality in, 84 health improvements in, 93 as landlocked, 205 war in, 145 Chandy, Laurence, 42, 243–44 Chavez, Hugo, 113 Chen, Shaohua, 27, 29 Chernenko, Konstantin, 134 Chernobyl nuclear power plant, 134 childbirth, 74, 75–82 child mortality, 24, 72–96, 74, 85, 93, 246 Chile, 47, 127 coup in, 100 democracy in, 104, 123 growth in, 6, 7, 45, 128, 147 individual leadership in, 187 life expectancy in, 78 malaria in, 210 Pinochet’s rule in, 107–8, 122, 141, 143–44 trade encouraged by, 155 Chiluba, Frederick, 133 China, ix–x, 3, 7, 20, 22, 106, 126, 144, 203, 292, 298, 300 authoritarian capitalism in, 147, 265–66 Coca-Cola in, 46 in confrontations with neighbors, 273 demand in, 53 demographic dividend in, 236 and dictatorships, 222 emigration from, 284 exploration by, 151–53 exports from, 154 future of, 234, 249–52 growth in, 6, 8–9, 15, 17, 21, 35–36, 45, 50, 62, 71, 125, 128, 147, 154, 201, 232, 233, 235–37, 242, 269 health in, 201 income in, 201 individual leadership in, 187 inequality in, 66, 69–70 infrastructure financing in, 259–60 innovation and technology in, 154–55, 302 market reforms in, 35, 102, 134–35, 192 natural capital in, 63 opening of, 5 per capital income in, 153 pollution in, 62 poverty reduction in, 201, 244 savings and investment in, 235 slowdown in growth of, 235–37, 249, 255, 257, 293 universities in, 247 US relationship with, 298–99 cholera, 77 Chun Doo-hwan, 99 Churchill, Winston, 97 civil liberties, 99, 199 civil rights, 112 civil servants, 102 civil war, 7 in Africa, 12 decline in, 115–16, 116 Civil War, US, 142 Clemens, Michael, 225 climate change, 4, 9, 19, 21, 63, 233, 234, 256, 272–73, 278, 281–84, 285–86, 296–97, 301, 305 coal, 44, 53, 278 Coca-Cola, 46, 159 cocoa, 163, 189 Cold War, 4, 7, 11, 16, 44, 52, 81, 100, 103, 115, 116, 131, 135, 144, 145, 146, 150, 156, 183, 184, 214, 223 Collier, Paul, 14–15, 118, 188, 202, 205, 213, 217, 227, 292, 303 Collins, Daryl, 32, 33–34 Collor de Mello, Fernando, 186 Colombia, 22, 237 data entry firms in, 178 universities in, 247 colonialism, 43–44, 52, 140, 147, 148, 149, 156 and independence, 140–43 of Indonesia, 136–40 Columbus, Christopher, 152 Coming Anarchy, The (Kaplan), 11 Commission on Growth and Development, 86, 165–66, 188 commodities, 53–57, 55, 163 Communism, 4, 11, 124, 125, 135, 139, 143, 146, 147, 149, 150, 184, 250 demise of, 16, 183 Communist Party, China, 123, 138, 250 Communist Party, Indonesia, 138 Communist Party, Soviet, 133, 138 comprehensive capital, 62–63 conflict, see violence Confucianism, 122 Congo, 114, 144, 185, 213, 243, 285 child mortality in, 84 civil war in, 181, 206 coup in, 100 education in, 190 lack of growth in, 50 war in, 81 Congress, US, 298 construction, 37, 45 consumption, 40–41, 40 Contingent Reserve Arrangement, 259 contract enforcement, 261 Converse, Nathan, 198 copper, 53 corn, 162, 281 corruption, 112, 261, 264 in Brazil, 186 in Thailand, 254 in US, 142 Costa Rica, 18, 58, 159 aid to, 223 as democracy, 7, 98, 123 growth in, 50 costume jewelry, 56 Côte d’Ivoire, 163, 263 cotton, 25 creative destruction, 249 Cuba, 22, 141, 145 and democracy, 248 dictatorship in, 100, 106, 144 Cultural Revolution, 35, 128, 153, 185 currencies, and resource curse, 206 Cuyamel Fruit Company, 97–98 Czechoslovakia, 143 protests in, 134 Velvet Revolution in, 103 Czech Republic, 184 da Gama, Vasco, 152 dairy products, 280 Darfur, 8, 10, 206 Dasgupta, Partha, 62–63 data entry firms, 178 Davies, Sally, 267 DDT, 212 Deaton, Angus, 89, 213 debts, 11, 193 in Africa, 12 deficits, 101 dehydration, 94, 173 de Klerk, F.
China's Future by David Shambaugh
Berlin Wall, capital controls, demographic dividend, demographic transition, Deng Xiaoping, facts on the ground, financial intermediation, financial repression, Gini coefficient, high net worth, knowledge economy, labour mobility, low skilled workers, market bubble, megacity, Mikhail Gorbachev, New Urbanism, offshore financial centre, open economy, Pearl River Delta, rent-seeking, secular stagnation, short selling, South China Sea, special drawing rights, too big to fail, urban planning, Washington Consensus, working-age population, young professional
Japan’s economic stagnation, closely related to the aging of its population, serves as a ready reference. China’s low fertility rate (1.7) is now below the replacement level and assures continually declining numbers of new entrants into the labor force, despite the loosening of the one-child policy restrictions in 2013 and its abolition in 2015. The situation is stark and the implications serious for China. The “demographic dividend” is over. As demographer Wang Feng of the University of California–Irvine aptly describes the situation, “The aging of China’s population represents a crisis (emphasis added) because its arrival is imminent and inevitable, because its ramifications are huge and long-lasting, and because its effects will be hard to reverse. Political legitimacy in China over the past three decades has been built around fast economic growth, which in turn has relied on a cheap and willing young labor force.
3D printing, bank run, banking crisis, Berlin Wall, Big bang: deregulation of the City of London, Bretton Woods, BRICs, British Empire, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, correlation coefficient, correlation does not imply causation, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, David Ricardo: comparative advantage, deindustrialization, demographic dividend, Eugene Fama: efficient market hypothesis, eurozone crisis, experimental economics, Fall of the Berlin Wall, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, German hyperinflation, Gunnar Myrdal, Home mortgage interest deduction, imperial preference, income inequality, inflation targeting, invisible hand, Isaac Newton, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, laissez-faire capitalism, liquidity trap, Long Term Capital Management, market bubble, market clearing, means of production, Mexican peso crisis / tequila crisis, mortgage debt, Myron Scholes, negative equity, Northern Rock, oil shale / tar sands, oil shock, open economy, Paul Samuelson, price stability, purchasing power parity, pushing on a string, quantitative easing, reserve currency, rising living standards, risk/return, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, secular stagnation, seigniorage, Silicon Valley, Simon Kuznets, The Chicago School, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Wealth of Nations by Adam Smith, Tobin tax, too big to fail, women in the workforce
There are several qualifications to be entered into this simplistic view. For one thing, the global economy has many more growth poles than it had when only the developed countries were the focus of the study of cycles. The EEs are still growing at a respectable pace – China at 7 percent. India has slowdown in growth but is expected to bounce back to its previous rate of around 7–8 percent and may grow even faster if it uses its demographic dividend. Indonesia, Vietnam, Mexico and Malaysia are all still growing strongly. In the first decade of the twenty-first century, sub-Saharan Africa has seen many economies growing at a good rate. Nigeria, Ghana, Kenya, Mozambique and Mauritius are averaging 5 percent per annum. There is a lot of potential there. The EEs save a lot and invest a lot.8 Some like China oversave. But even in China the seeds of change are being sown and recently there has been a refashioning of economic policy that could shift the emphasis away from exports toward domestic consumption.
The End of Growth: Adapting to Our New Economic Reality by Richard Heinberg
3D printing, agricultural Revolution, back-to-the-land, banking crisis, banks create money, Bretton Woods, carbon footprint, Carmen Reinhart, clean water, cloud computing, collateralized debt obligation, computerized trading, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, David Graeber, David Ricardo: comparative advantage, dematerialisation, demographic dividend, Deng Xiaoping, Elliott wave, en.wikipedia.org, energy transition, falling living standards, financial deregulation, financial innovation, Fractional reserve banking, full employment, Gini coefficient, global village, happiness index / gross national happiness, I think there is a world market for maybe five computers, income inequality, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Isaac Newton, Kenneth Rogoff, late fees, liberal capitalism, mega-rich, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, naked short selling, Naomi Klein, Negawatt, new economy, Nixon shock, offshore financial centre, oil shale / tar sands, oil shock, peak oil, Ponzi scheme, post-oil, price stability, private military company, quantitative easing, reserve currency, ride hailing / ride sharing, Ronald Reagan, short selling, special drawing rights, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, too big to fail, trade liberalization, tulip mania, working poor, zero-sum game
Since World War II, eight countries (Tunisia, Japan, South Korea, Singapore, Taiwan, Barbados, Hong Kong, and Bahamas) have achieved the shift from being listed as “developing” to “developed” by first bringing fertility down through strong family planning programs. Once fewer children were being born, families found that they had money left over after paying for basic necessities, and this led to capital formation through personal savings. Demographers call this the “demographic dividend.” The continent of Africa will probably encounter the worst demographic challenges of any region in the decades ahead. Its population is expected to double its numbers by 2050, according to the UN. By then, Africa’s urban population may have tripled, with 1.3 billion living in cities. These trends of rapid population growth and rapid urbanization cannot be sustained in a world of declining energy, scarce water, and changing climate, and will soon become enormous liabilities as today’s quickly growing slums turn into centers of even greater human misery.
Earth Wars: The Battle for Global Resources by Geoff Hiscock
Admiral Zheng, Asian financial crisis, Bakken shale, Bernie Madoff, BRICs, butterfly effect, clean water, cleantech, corporate governance, demographic dividend, Deng Xiaoping, Edward Lorenz: Chaos theory, energy security, energy transition, eurozone crisis, Exxon Valdez, flex fuel, global rebalancing, global supply chain, hydraulic fracturing, Long Term Capital Management, Malacca Straits, Masdar, mass immigration, megacity, Menlo Park, Mohammed Bouazizi, new economy, oil shale / tar sands, oil shock, Panamax, Pearl River Delta, purchasing power parity, Ralph Waldo Emerson, RAND corporation, Shenzhen was a fishing village, Silicon Valley, smart grid, South China Sea, sovereign wealth fund, special economic zone, spice trade, trade route, uranium enrichment, urban decay, working-age population, Yom Kippur War
Institutional, legal, and financial reforms within China are moribund. And, the economists argue, if fundamental human rights and the rule of law are lacking, can any nation claim to be a winner? Plus, there is a sting in the tail of China’s urban one-child policy. This is a complex and controversial issue, but essentially since the late 1970s, the policy has saved China from having to feed an extra 400 million mouths. Now that demographic dividend might be turning against it, as fertility falls and the population ages. Consumer demand is rising, of course, but a society without siblings is likely to be a sorry situation. In contrast, by rights, India’s democracy, demography, and dynamic diaspora should deliver it a large chunk of economic good fortune over the next few decades. According to the UN’s latest population projections, India will have more people than China by 2025, when China’s population will peak at just under 1.4 billion.
Whole Earth Discipline: An Ecopragmatist Manifesto by Stewart Brand
agricultural Revolution, Asilomar, Asilomar Conference on Recombinant DNA, back-to-the-land, biofilm, borderless world, Buckminster Fuller, business process, Cass Sunstein, clean water, Community Supported Agriculture, conceptual framework, Danny Hillis, dark matter, decarbonisation, demographic dividend, demographic transition, Elon Musk, Exxon Valdez, failed state, Geoffrey West, Santa Fe Institute, glass ceiling, Google Earth, Hans Rosling, Hernando de Soto, informal economy, interchangeable parts, Intergovernmental Panel on Climate Change (IPCC), invention of agriculture, invention of the steam engine, Jane Jacobs, jimmy wales, Kevin Kelly, Kibera, land tenure, M-Pesa, Marshall McLuhan, megacity, microbiome, New Urbanism, out of africa, Paul Graham, peak oil, Richard Florida, Ronald Reagan, Silicon Valley, smart grid, stem cell, Stewart Brand, The Fortune at the Bottom of the Pyramid, Thomas Malthus, University of East Anglia, uranium enrichment, urban renewal, wealth creators, Whole Earth Catalog, Whole Earth Review, William Langewiesche, working-age population, Y2K
Before 2009, everyone marveled at China’s 10 percent annual growth; but India had 8 percent, and Africa—no longer the basket case people think it is—had 7 percent, led by South Africa. In 2007 the U.S. economy grew by 2.2 percent, France’s grew by 1.8 percent, and Japan’s grew by 1.9 percent. It will be interesting to see who recovers first and fastest following the economic disruptions of 2009. The nations of the global south are coming into their demographic dividend. The new millions of young adults live in cities, voting with their ovaries for fewer children and more opportunity. They are mostly of working age, burdened by relatively few infants and elderly dependents. “Poor countries with low and falling fertility rates are growing wealthier faster than rich modern countries,” wrote Ben Wattenberg in his 2004 book on depopulation, Fewer. “We live in a youthful world,” says a 2006 UN report.
3D printing, Airbnb, Albert Einstein, Berlin Wall, Black Swan, Chuck Templeton: OpenTable, clean water, collapse of Lehman Brothers, creative destruction, Credit Default Swap, crony capitalism, crowdsourcing, Danny Hillis, declining real wages, demographic dividend, Elon Musk, en.wikipedia.org, Eugene Fama: efficient market hypothesis, Fall of the Berlin Wall, follow your passion, game design, housing crisis, Hyman Minsky, industrial robot, invisible hand, James Dyson, Jane Jacobs, Jeff Bezos, jimmy wales, John Gruber, John Markoff, Joseph Schumpeter, Kickstarter, lone genius, manufacturing employment, Marc Andreessen, Mark Zuckerberg, Martin Wolf, new economy, Paul Graham, Peter Thiel, QR code, race to the bottom, reshoring, Richard Florida, Ronald Reagan, shareholder value, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, six sigma, Skype, Steve Ballmer, Steve Jobs, Steve Wozniak, supply-chain management, Tesla Model S, The Chicago School, The Design of Experiments, the High Line, The Myth of the Rational Market, thinkpad, Tim Cook: Apple, too big to fail, tulip mania, We are the 99%, Y Combinator, young professional, Zipcar
A second Dream:IN conference was held in Brazil, Carlos’s home country, in the summer of 2012, http://www.fastcodesign.com/1663223/looking-to-realize-dreams-in-india-with-new-business-models. 75 “More education” was probably the most: I was present in India, participating at the Dream:IN conference, when the major themes were presented after the video narratives were collected and collated. 76 They already have $50,000: Sonia Manchanda, interview with author, autumn 2011. 76 a country where more than 65 percent: Kaushik Basu, “India’s Demographic Dividend,” BBC News, July 25, 2007, accessed September 10, 2012, http://news.bbc.co.uk/2/hi/south_asia/6911544.stm. 77 Keith Richards and Mick Jagger: Keith Richards and James Fox, Life (New York: Little, Brown and Company, 2010). 77 Today, the business degree: National Center for Education Statistics, Fast Facts, http://nces.ed.gov/fastfacts/display.asp?id=37, accessed September 16, 2012; Michelle Megna, http://Schools.com, 5 most popular undergraduate majors of 2011 entry-level hires, http://www.schools.com/articles/most-popular-degrees-employers.html, accessed September 16, 2012. 78 In a talk given to a freshman: Bill Deresiewicz, article adapted from address to students at Stanford University, May 2010, http://chronicle.com/article/What-Are-You-Going-to-Do-With/124651/. 78 I recently had lunch with someone: This informal talk occurred in the spring of 2012. 80 3M was a pioneer of this strategy: Paul D.
Half the Sky: Turning Oppression Into Opportunity for Women Worldwide by Nicholas D. Kristof, Sheryl Wudunn
agricultural Revolution, correlation does not imply causation, demographic dividend, feminist movement, Flynn Effect, illegal immigration, Mahatma Gandhi, microcredit, paper trading, rolodex, Ronald Reagan, Rosa Parks, school choice, special economic zone, transatlantic slave trade, transatlantic slave trade, women in the workforce
Economists who scrutinized East Asia’s success noted a common pattern. These countries took young women who previously had contributed negligibly to gross national product (GNP) and injected them into the formal economy, hugely increasing the labor force. The basic formula was to ease repression, educate girls as well as boys, give the girls the freedom to move to the cities and take factory jobs, and then benefit from a demographic dividend as they delayed marriage and reduced childbearing. The women meanwhile financed the education of younger relatives, and saved enough of their pay to boost national savings rates. This pattern has been called “the girl effect.” In a nod to the female chromosomes, it could also be called “the double X solution.” Evidence has mounted that helping women can be a successful poverty-fighting strategy anywhere in the world, not just in the booming economies of East Asia.
Seventeen Contradictions and the End of Capitalism by David Harvey
accounting loophole / creative accounting, bitcoin, Branko Milanovic, Bretton Woods, BRICs, British Empire, business climate, California gold rush, call centre, central bank independence, clean water, cloud computing, collapse of Lehman Brothers, colonial rule, creative destruction, Credit Default Swap, David Ricardo: comparative advantage, deindustrialization, demographic dividend, Deng Xiaoping, deskilling, drone strike, end world poverty, falling living standards, fiat currency, first square of the chessboard, first square of the chessboard / second half of the chessboard, Food sovereignty, Frank Gehry, future of work, global reserve currency, Guggenheim Bilbao, Gunnar Myrdal, income inequality, informal economy, invention of the steam engine, invisible hand, Isaac Newton, Jane Jacobs, Jarndyce and Jarndyce, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Just-in-time delivery, knowledge worker, low skilled workers, Mahatma Gandhi, market clearing, Martin Wolf, means of production, microcredit, new economy, New Urbanism, Occupy movement, peak oil, phenotype, Plutocrats, plutocrats, Ponzi scheme, quantitative easing, rent-seeking, reserve currency, road to serfdom, Robert Gordon, Ronald Reagan, short selling, Silicon Valley, special economic zone, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, transaction costs, Tyler Cowen: Great Stagnation, wages for housework, Wall-E, women in the workforce, working poor, working-age population
This relation continues to be important in certain parts of the world. Early on in capital’s history, rapid population growth or a vast reserve of untapped and yet-to-be urbanised wage labour unquestionably helped to fuel rapid capital accumulation. Indeed, a plausible case can be made that population growth from the early seventeenth century on was a precondition for capital accumulation. The role of what Gordon calls ‘the demographic dividend’ in fostering economic growth was clearly important in the past and continues to be so. The vast inflow of women into the labour force in North America and Europe after 1945 is one case in point, but this is something that cannot be repeated. The world’s labour force expanded by 1.2 billion between 1980 and 2009, nearly half of that growth coming from India and China alone. This too will be hard to repeat.
Age of Discovery: Navigating the Risks and Rewards of Our New Renaissance by Ian Goldin, Chris Kutarna
2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, Airbnb, Albert Einstein, AltaVista, Asian financial crisis, asset-backed security, autonomous vehicles, banking crisis, barriers to entry, battle of ideas, Berlin Wall, bioinformatics, bitcoin, Bonfire of the Vanities, clean water, collective bargaining, Colonization of Mars, Credit Default Swap, crowdsourcing, cryptocurrency, Dava Sobel, demographic dividend, Deng Xiaoping, Doha Development Round, double helix, Edward Snowden, Elon Musk, en.wikipedia.org, epigenetics, experimental economics, failed state, Fall of the Berlin Wall, financial innovation, full employment, Galaxy Zoo, global supply chain, Hyperloop, immigration reform, income inequality, indoor plumbing, industrial cluster, industrial robot, information retrieval, Intergovernmental Panel on Climate Change (IPCC), intermodal, Internet of things, invention of the printing press, Isaac Newton, Islamic Golden Age, Khan Academy, Kickstarter, labour market flexibility, low cost carrier, low skilled workers, Lyft, Malacca Straits, mass immigration, megacity, Mikhail Gorbachev, moral hazard, Network effects, New Urbanism, non-tariff barriers, Occupy movement, On the Revolutions of the Heavenly Spheres, open economy, Panamax, Pearl River Delta, personalized medicine, Peter Thiel, post-Panamax, profit motive, rent-seeking, reshoring, Robert Gordon, Robert Metcalfe, Search for Extraterrestrial Intelligence, Second Machine Age, self-driving car, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Skype, smart grid, Snapchat, special economic zone, spice trade, statistical model, Stephen Hawking, Steve Jobs, Stuxnet, TaskRabbit, The Future of Employment, too big to fail, trade liberalization, trade route, transaction costs, transatlantic slave trade, uranium enrichment, We are the 99%, We wanted flying cars, instead we got 140 characters, working poor, working-age population, zero day
Several, but certainly not all, of its countries enjoy resource wealth (40 percent of the world’s gold and 90 percent of its platinum are in Africa), which, in the hands of good governments, could be invested in public infrastructure and skills. And good government is better understood: citizens know their rights much better and are holding those in power accountable with ever-rising frequency.98 Africa is also blessed with a looming demographic dividend. Its working-age population will balloon from 500 million people now to over 1.1 billion by 2040.99 If local governments can learn how to foster neighborhoods instead of slums, and if national governments can better integrate their too-small economies and build better institutions, Africans might banish extreme poverty from their midst before mid-century. The second reason why the health, wealth and education achievements of this New Renaissance outweigh the shortcomings is their breadth.
How Asia Works by Joe Studwell
affirmative action, anti-communist, Asian financial crisis, bank run, banking crisis, barriers to entry, borderless world, Bretton Woods, British Empire, call centre, capital controls, central bank independence, collective bargaining, crony capitalism, cross-subsidies, currency manipulation / currency intervention, David Ricardo: comparative advantage, deindustrialization, demographic dividend, Deng Xiaoping, failed state, financial deregulation, financial repression, Gini coefficient, glass ceiling, income inequality, income per capita, industrial robot, Joseph Schumpeter, Kenneth Arrow, land reform, land tenure, large denomination, liberal capitalism, market fragmentation, non-tariff barriers, offshore financial centre, oil shock, open economy, passive investing, purchasing power parity, rent control, rent-seeking, Right to Buy, Ronald Coase, South China Sea, The Wealth of Nations by Adam Smith, urban sprawl, Washington Consensus, working-age population
Labour is an input into an economy – a form of ‘capital’ – just like money, and a large working-age population relative to the cohorts of children and retired people increases the possibilities for fast growth. Rapidly declining death rates – particularly for children – and rapidly rising working-age populations have been a big part of the east Asian developmental story since the Second World War. These demographic trends, largely the result of advances in medicine and sanitation, have facilitated unprecedented growth. The phenomenon is sometimes referred to as the ‘demographic dividend’. The flip side of this dividend is that it is followed by the faster ageing of populations – by which we really mean the increase of retired people relative to workers. After a tipping point, workforces start to shrink quickly, and older people consume their savings, devouring what were previously funds for investment. Japan’s problems since the 1980s have been bound up with acute demographic challenges in an only recently matured industrial economy.
India's Long Road by Vijay Joshi
Affordable Care Act / Obamacare, barriers to entry, Basel III, basic income, blue-collar work, Bretton Woods, business climate, capital controls, central bank independence, clean water, collapse of Lehman Brothers, collective bargaining, colonial rule, congestion charging, corporate governance, creative destruction, crony capitalism, decarbonisation, deindustrialization, demographic dividend, demographic transition, Doha Development Round, eurozone crisis, facts on the ground, failed state, financial intermediation, financial repression, first-past-the-post, floating exchange rates, full employment, germ theory of disease, Gini coefficient, global supply chain, global value chain, hiring and firing, income inequality, Indoor air pollution, Induced demand, inflation targeting, invisible hand, land reform, Mahatma Gandhi, manufacturing employment, Martin Wolf, means of production, microcredit, moral hazard, obamacare, Pareto efficiency, price mechanism, price stability, principal–agent problem, profit maximization, profit motive, purchasing power parity, quantitative easing, race to the bottom, randomized controlled trial, rent-seeking, reserve currency, rising living standards, school choice, school vouchers, secular stagnation, Silicon Valley, smart cities, South China Sea, special drawing rights, The Future of Employment, The Market for Lemons, too big to fail, total factor productivity, trade liberalization, transaction costs, universal basic income, urban sprawl, working-age population
Part II focuses on the challenge of accomplishing rapid growth. Chapter 4 begins with an introduction to the sources of growth in India, and proceeds to examine one of these, viz. capital accumulation, and the ‘animal spirits’ that drive it. Chapter 5 analyzes India’s ‘employment problem’ and how it [ 10 ] Setting the Stage 11 should be tackled to speed up growth by harnessing the so-called ‘demographic dividend’. Chapter 6 ranges widely over the distortions in the economy that are holding back productivity improvement, and the corrective measures required. Chapter 7 examines productivity growth in relation to public and private ownership, with particular attention to the infrastructure sectors. It also considers the problem of making growth environmentally sustainable. Part III examines the ‘stability’ and ‘inclusion’ aspects of the development objective.
In Spite of the Gods: The Rise of Modern India by Edward Luce
affirmative action, Albert Einstein, Bretton Woods, call centre, centre right, clean water, colonial rule, crony capitalism, cuban missile crisis, demographic dividend, energy security, financial independence, friendly fire, Gini coefficient, Haight Ashbury, informal economy, job-hopping, land reform, Mahatma Gandhi, Martin Wolf, megacity, new economy, Plutocrats, plutocrats, profit motive, purchasing power parity, Silicon Valley, trade liberalization, upwardly mobile, uranium enrichment, urban planning, women in the workforce, working-age population, Y2K
In spite of the pressures of population density, India’s clearest advantage over China and other developing countries is its demographic profile. From 2010, China’s dependency ratio—the proportion of the working-age population to the rest—will start to deteriorate. In contrast, India’s dependency ratio will continue to improve until the 2040s.34 In the next twenty years, the proportion of dependents to workers will fall from 60 percent of the population to 50 percent. This will give India’s economy a large “demographic dividend.” It is commonplace to say a nation’s future lies in its youth. But India’s future also lies in its youthfulness. The higher the proportion of the population that is of working age, the higher the rate of savings in the economy. A higher savings ratio boosts investment, which lifts economic growth in a virtuous circle that for India stretches almost as far as the eye can see. Already India’s savings ratio is improving—from about 18 percent of gross domestic product in 1990 to 26 percent in 2006.
Thank You for Being Late: An Optimist's Guide to Thriving in the Age of Accelerations by Thomas L. Friedman
3D printing, additive manufacturing, affirmative action, Airbnb, AltaVista, Amazon Web Services, autonomous vehicles, Ayatollah Khomeini, barriers to entry, Berlin Wall, Bernie Sanders, bitcoin, blockchain, Bob Noyce, business process, call centre, centre right, Chris Wanstrath, Clayton Christensen, clean water, cloud computing, corporate social responsibility, creative destruction, crowdsourcing, David Brooks, demand response, demographic dividend, demographic transition, Deng Xiaoping, Donald Trump, Erik Brynjolfsson, failed state, Fall of the Berlin Wall, Ferguson, Missouri, first square of the chessboard / second half of the chessboard, Flash crash, game design, gig economy, global supply chain, illegal immigration, immigration reform, income inequality, indoor plumbing, intangible asset, Intergovernmental Panel on Climate Change (IPCC), Internet of things, invention of the steam engine, inventory management, Irwin Jacobs: Qualcomm, Jeff Bezos, job automation, John Markoff, John von Neumann, Khan Academy, Kickstarter, knowledge economy, knowledge worker, land tenure, linear programming, Live Aid, low skilled workers, Lyft, Marc Andreessen, Mark Zuckerberg, mass immigration, Maui Hawaii, Menlo Park, Mikhail Gorbachev, mutually assured destruction, pattern recognition, planetary scale, pull request, Ralph Waldo Emerson, ransomware, Ray Kurzweil, Richard Florida, ride hailing / ride sharing, Robert Gordon, Ronald Reagan, Second Machine Age, self-driving car, shareholder value, sharing economy, Silicon Valley, Skype, smart cities, South China Sea, Steve Jobs, supercomputer in your pocket, TaskRabbit, Thomas L Friedman, transaction costs, Transnistria, urban decay, urban planning, Watson beat the top human players on Jeopardy!, WikiLeaks, women in the workforce, Y2K, Yogi Berra, zero-sum game
In hindsight, the period from World War II up to the fall of the Berlin Wall was “an incredible period of economic moderation,” argued James Manyika, one of the directors of the McKinsey Global Institute. And economic moderation drove political moderation and stability. It made inclusion and immigration easier to tolerate. Most countries were also still benefiting from improved health care and decreased child mortality, producing a demographic dividend of bulging youth populations and relatively few older people to take care of. This made more generous pensions easier to handle in many countries. And most countries had not eaten through their natural capital. All in all, it was relatively easy to be an “average” democracy or autocracy during the Cold War and even into the post–Cold War period. It was a geopolitical Holocene. Well, say goodbye to all that as well.