Commentators are asking for context for this graph. Personally, I threw it up because I found it interesting and surprising. I did not expect Equatorial Guinea to be at the top of the list. As has been pointed out, using this to say that development has taken place in the top growth countries is misleading (as is the case with relying on any single indicator). According to The Economist, GDP per person is still the measure that gives the best indicator of economic progress or lack thereof."
To give an idea of the importance of context "Slow population growth also helps: although America's economy has grown considerably faster than Japan's since 2001, Japan’s population has shrunk while America's has risen. This means that income per head in Japan has grown almost as rapidly as in America over this period." I would add that for some of the faster growing nations it is not shown where the growth is happening. Natural resources contribute to the rise which makes me wonder if that means that technocrats and oligarchs are growing in wealth.
If I can do so, it would be useful to compare these rates against unemployment, median income levels and poverty rates.
Via The Economist
4 comments:
I went to the Economist page and see that they call GDP per person the most reliable indicator of economic progress. I really don't see how they can even say this when at the top of the list is EG. GDP doesn't indicate 'progress' at all. It indicates economic activity/transactions. Has there really been progress in EG? Isn't it mostly the wealthy getting wealthier? And this 'per person' tag is just infuriating. That isn't based on any real data of what is happening at an individual level at all, is it? It's based on GDP and then divided by population.
GDP is also an extremely poor measure of economic anything in countries where the majority of economic activity occurs in the informal sector, which is where MOST of the economic activity occurs in African countries. GDP as a measure is useless at best, and extremely misleading and dangerous, at worst. Its use in policy decisions and to indicate progress is probably mostly beneficial to the people who already have power and money.
Thanks Stephanie. I agree with you. Growth rates are important to the extent that the country is growing economically. So, we want them in the positive, but high rates do not mean that a country has suddenly eradicated poverty. Two strong examples of this are China and India where the economies are booming but poverty remains quite high. An interesting graphic would be to see the poverty rates and individual incomes for each of the countries. I suspect that you are right when asking if it is just the wealthy getting wealthier.
This kind of graph feeds into the "GDP as gold standard" method of measuring human development. I'm surprised to see it on a development blog without text to put it into context. BTW, where is Ethiopia, Africa's aid darling and previous GDP growth frontrunner?
You are right and I just added some context and thoughts. Frankly, I threw it up because it was surprising and did not have enough time to really add anything. The question of Ethopia is a good one. Maybe the numbers are not so high when taken in the context of GDP per person.
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