Emerging economies: Hold the catch-up

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Emerging economies

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Incomes in the developing world are no longer speeding toward those in the rich

THE financial crisis was grim, but the most important global economic development in the early 21st century was a positive one: the dramatic acceleration of growth in the emerging world. Between 2000 and 2009 output per person in poor countries excluding China grew an average of 3.2 percentage points a year faster than rich ones—an unprecedented pace of catch-up. Global poverty rates tumbled. Were that pace of convergence to be sustained, average income in those countries would reach America’s in about 44 years.
Unfortunately, the era of rapid catch-up already seems to be over (see article). Growth has fallen sharply in many emerging economies. Despite the rich world’s feeble recovery in the wake of the financial crisis, emerging economies excluding China are now catching up more slowly, if at all. In 2013 their output per person, on average, grew just 1.1% faster than that in America. At that …

Link to article: www.economist.com/news/leaders/21616951-incomes-developing-world-are-no-longer-speeding-toward-those-rich-hold-catch-up?fsrc=rss

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