Divergence, Big Time

Lant Pritchett

Journal of Economic Perspectives, 1997, vol. 11, issue 3, 3-17

Abstract: Historical data are unnecessary to demonstrate that perhaps the basic fact of modern economic history is massive absolute divergence in per capita income across countries. A plausible lower bound on per capita income can be combined with estimates of its current level in the poorer countries to place an upper bound on long-run income growth. Between 1870 and 1990, the ratio of richest to poorest countries' income increased from roughly 9 to 1 to 45 to 1, the standard deviation of (natural log) per capita income doubled, and the average income gap between the richest and all other countries grew nearly tenfold from $1,286 to $12,000.

JEL-codes: E24 J21 J64 N10 O47 (search for similar items in EconPapers)
Date: 1997
Note: DOI: 10.1257/jep.11.3.3
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Citations: View citations in EconPapers (488)

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