Economic growth and economic development 26

10 Introduction to Modern Economic Growth UK South Korea Spain Brazil Singapore Guatemala Botswana India log gdp per capita USA Nigeria 1960 1970 1980 year 1990 2000 Figure 1.8 The evolution of income per capita in the United States, United Kingdom, Spain, Singapore, Brazil, Guatemala, South Korea, Botswana, Nigeria and India, 1960-2000 we will see that there is a lot of truth to this simple calculation; see Figures 1.8, 1.11 and 1.13) In fact, even in the historically-brief postwar era, we see tremendous differences in growth rates across countries This is shown in Figure 1.7 for the postwar era, which plots the density of growth rates across countries in 1960, 1980 and 2000 The growth rate in 1960 refers to the (geometric) average of the growth rate between 1950 and 1969, the growth rate in 1980 refers to the average growth rate between 1970 and 1989 and 2000 refers to the average between 1990 and 2000 (in all cases subject to data availability; all data from Penn World tables) Figure 1.7 shows that in each time interval, there is considerable variability in growth rates; the cross-country distribution stretches from negative growth rates to average growth rates as high as 10% a year 12