Golden age

OECD Observer

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How far has the OECD economy travelled in the last two hundred years? According to economic historian, Angus Maddison, GDP per capita worldwide has risen more than eightfold since 1820, compared with a fivefold increase in population, though the rate of growth has been uneven by time and by country.

From 1870 to 1913, world capita GDP rose 1.3% per year compared with 0.5% in 1820-70. Two world wars, the collapse of capital flows, migration and trade shattered the old economic order between 1913 and 1950, though by harnessing technological developments – electricity, automobiles, aviation and chemistry, etc. – the United States had become the world leader in terms of productivity and per capita income. The world economy as a whole performed better from 1950 to 2000 than at any time before. Real per capita income rose by 2.1% a year, compared with 0.9% from 1820-1950.

The golden age, from 1950 to 1973, saw a degree of convergence between the US and other advanced capitalist countries (western Europe and Japan) coinciding with a new liberal international order. Indeed, Japan, despite just having emerged from a decade of economic stagnation, has had the fastest growth, its per capita income growth increasing sixfold during the golden age, at 8% per year compared with 4% in western Europe.

Reference

Maddison A. (2003), The World Economy – A Millennial Perspective, OECD Development Centre.

©OECD Observer No 243, May 2004




Economic data

GDP growth: +0.5% Q2 2019 year-on-year
Consumer price inflation: 1.9% August 2019 annual
Trade: +0.4% exp, -1.2% imp, Q1 2019
Unemployment: 5.1% August 2019
Last update: 9 September 2019

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