Ha-Joon Chang

The world economy, which was growing at about 3% in per capita terms in the \”bad old days\” of widespread regulation and punitive taxation for the rich in the 1960s and 70s, has grown at about half that rate in the last three decades.

Hmm.

Taking a quick look at Angus Maddison\’s figures that doesn\’t seem to be true.

So what else are we to be told that isn\’t true to bolster the case for those clever people to tell us all what to do rather than us being allowed to decide what to do for ourselves?

3 comments on “Ha-Joon Chang

  1. Chang uses World Bank statistics in most of his books I’d suspect that would be where he sourced the claim in that article.

    From what I could see, from Maddison’s work it confirms that growth was higher in the “bad old days” although not to the extent of Chang’s claim although this could simply be down to different methodologies.

  2. Economic growth was stronger in the bad old days, that is certain, the exact difference isn’t really too important.

    The question isn’t whether this is true or not, it is whether this growth was because we had superior (less market orientated) institutions or because we had worse (less market orientated) institutions but had a greater rate of innovation and invention by sheer historical fluke, see Krugman, Sumner and Dillow on this from a few months ago.

    I think it is a little of both, particularly in the developing world, but I assume you will think differently.

    Tim adds: Well, actually, I tend to think that a great deal of the growth from, say, 1950 to 1970 ish was as a result of the lack of growth (to put it mildly) in 1930-1945. It really wouldn’t surprise me at all if you had 15 years of below trend growth to then have a couple of decades of above trend growth then a reversion to trend growth. Wouldn’t surprise me at all actually.

  3. Indeed, the 1930s were one of the most technologically progressive of human history… didn’t translate into economic growth at the time, but it would have to at some time.

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