http://fortune.com/2017/02/09/study-china-will-overtake-the-...
https://www.quora.com/Economic-History-At-what-point-did-the...
http://fortune.com/2017/02/09/study-china-will-overtake-the-...
https://www.quora.com/Economic-History-At-what-point-did-the...
The Chinese government works much more directly in twisting the knobs of the economy, and the government regularly misleads with their economic numbers (sort of like companies that change the accounting rules on the numbers they report). As a result other methods get devised to try to estimate the Chinese GDP and its relative independence from other economies.
That said, they are expected to surpass the US on a comparative GDP model, what is less well understood is how durable their form of market management can be.
With competent governance, max size of the economy is linearly tied to population, with some wiggle room for natural resources.
This is why Japan was always going to level off, and why China is going to be on top.
> why China is going to be on top
India will have a larger population than China (http://statisticstimes.com/population/china-vs-india-populat...) so it should end up on top.
> competent governance
India is far from competent in this regard.
What does this mean exactly? Getting lapped means getting passed and then passed again. How does that make sense in this context?
The rise of China has made the first tier out of reach to countries with only 60-80 million people (such as the UK, France, and Germany). If the European powers combined - somehow, who knows how - then they would have the weight to be global powers and have more influence to move global affairs in directions the Europeans desire. With only 60 million people, the UK is destined to be a bit player.
One wonders why a neighboring second tier Eurasian power would want to disrupt European integration and the resulting arrival of a superpower on their doorstep. Stand together, or hang separately.
Ukraine as the "trial" case?
Russia's GDP in the late 1980s was around half a trillion dollars. Today it's around $1.3 trillion. Accounting for even a small amount of annual inflation, they've grown the economy by perhaps 20% to 30% over 30 years. And that's coming from an extremely backwards Communist system.
Russian GDP has dropped since 2014 due to sanctions. If you look at prior to sanctions, growth is more impressive.
From [1]:
GDP (USD billion) 1990 2014 --------------------------------- UK 1093 2999 India 317 2035 Russia 517 2064
Recent growth is much stronger [2] [3].
[1] https://www.google.com.au/publicdata/explore?ds=d5bncppjof8f...
[2] https://www.reuters.com/article/us-russia-gdp/russias-gdp-gr...
[3] https://www.focus-economics.com/countries/russia/news/gdp/ec...
Whether a superpower we can debate, but they still have massive influence.
> Is not being part of a superpower a necessarily bad thing? So long as you have NATO for defense and EU for free trade, then yeah, what is the difference?
With regards to power, no one is best served by losing power. If you lose power you will be unable to defend your best interests. If that's a good thing or a bad thing?
"the resulting arrival of a superpower" = a stronger version of the EU.
Once you have nukes, superpower status has a power ceiling. The US demonstrated that we can grind up a non-nuclear power like Iraq. We cannot do the same to any number of other tiny countries that have the bomb or similar leverage.
It'll take China 30 to 40 years to catch the US at the present trajectory. They're outrunning the US at about $200 billion per year if you assume present numbers going forward and if you believe the claimed Chinese growth figures. The gap is $7.5 to $8 trillion, while China's growth is slowing by the year.
That's ~30 year span is a best case scenario for China. The far more likely scenario, is they collide with common economic reality, with standard recessions, growth problems, debt problems, along with a continual decline in their growth rate. The last 20 years they've gotten to avoid most of those problems due to massive easy slack to fill in, in their formerly backwards economy. The debt is already there however, as they've taken on at least $50 trillion in new debt to fake their growth the last ten years (including shadow debt at the state enterprise and local muni levels). That's something they can never repeat going forward (their system is already shaking under the debt, they're constantly having to inject liquidity and restrict capital flows to keep the house of cards standing).
China has a roughly $11.5 trillion economy growing at a claimed 6.5%, with a persistent decline in their growth rate.
The US has a $19 to $19.5 trillion economy. The US is able to grow at 2.5% routinely, possibly higher in the near future.
In 2014, China's economy was $10.48 trillion. In 2015, it was $11.06 trillion. In 2016 it was $11.2 trillion.
In the time China added $1 trillion to its economy, the US added $1.6 trillion to its economy.
At 2.5% on $19 or $19.5 trillion, the US can routinely add nearly half a trillion per year to its economy.
At 6% on $11.5 trillion, China is adding $650 to $700 billion to its economy in 2018. Gradually slow their growth to even 4% to 4.5% over the next four or five years, and they may never catch the US.
I'd be willing to bet the US can sustain 2% to 2.5% growth going forward, while China can't sustain above 6%. This is especially obvious given the dramatic down curve over ten years in their growth rate. To add further to that point, there is wide agreement among economists that China aggressively lies about their GDP growth numbers, it's more likely to be closer to half the stated number.
How much of the economy is propped up by transfer payments and military related expense, all funded by borrowing?
Once diverse regional economies like the NY Metro Area are increasingly dependent on a narrow set of industry. IMO, the future is hard to predict and is likely to diverge from the 20th century.
Economic statistics for the US with fully disclosed methodologies are readily available. US military spending in 2016 was 3.3% of GPD, according to the World Bank. [1] New York’s economy is more industrially diverse than average (ranked 17 out of 51) with Long Island as the most diverse county in the state. [2] I realize that fed report is out of date, but as of 2016, the NY Metro area itself had a GDP of nearly $1.7 trillion, making it one of the larger economies in the world. [3]
[1] https://data.worldbank.org/indicator/MS.MIL.XPND.GD.ZS?end=2...
[2] https://www.newyorkfed.org/medialibrary/media/research/regio...
[3] https://www.bea.gov/newsreleases/regional/gdp_metro/gdp_metr...
The US clearly engages in the sort of behaviour that was described as trickery. The state is massively indebted and piling on huge deficits each year, and the only thing that keeps lenders lending money is this belief that the US will always repay its debt. Meanwhile the US deficit is used as a never ending source of free money created out of thin air that's injected into the economy, thus contributing to artificially inflate the volume of money being exchanged (i.e., the GDP)
If you compare the economy of 1967 to 2017, it’s more telling for NYC. Upstate is even more dramatic. The economy in central/western NY imploded.
The trickery is around the massive debt and the use of the dollar as a reserve currency. 100 dollar bills represent 80% of currency in circulation are like the equivalent of beaver bonds overseas.
Ha - nobody can see that far out.
Also, it's all based on relative value, PPP - so it's an incredibly difficult thing.
One could also argue that China surpassed the US a long time ago.
Chinese go abroad to shop for good reasons.
Japan has a smaller population than the US. Even with early automaton providing a huge multiplier effect to efficiency, they weren't likely to catch up.
Combine that with social pressure against immigration. The US benefited a lot from brain draining other countries, Japan never did. The odds of a country being the source of innovation are higher if all the world's geniuses keep moving to that country.
Next up, will China be willing to (keep) hiring away American professors? If China can clean up its air quality, continue to improve standards of living, and open itself up to immigration, it will be on track to best the US.
Shear numbers means that if they stay away from self-destructive policies, civil war, and climate change doesn't squash their resources they'll be the biggest economy.
Not per capita, but in total yes, and wouldn't it be unfair if they didn't... Consider how many people would live in poverty, if they don't grow.