American declinism is a broad church. Yet on a range of measures its economic dominance remains striking, and relative to its rich-world peers its lead is increasing
America’s outperformance has translated into wealth for its people.terms; today it is about 30% higher. It was 17% higher than in Japan in 1990; today it is 54% higher. Interms the only countries with higher per-person income figures are small petrostates like Qatar and financial hubs such as Luxembourg. A lot of that income growth was at the top end of the scale; the ultra rich have indeed done ultra well. But most other Americans have done pretty well, too.
Past performance is, of course, no predictor of future returns. Since America became the world’s largest economy in the 1890s its lead has waxed and waned. But three decades in, its current period of outperformance has gone on long enough to merit a closer look. Some of America’s productivity growth comes from more investment. But total factor productivity , which strips out those effects in an attempt to show increases in efficiency and the adoption of new technology, has also increased. According to the Penn World Tables, a database for cross-country comparisons,as a whole averaged less than half that.
table. Along with educating many of the brightest Americans, they have long served as conduits which deliver the world’s smartest young people to the country. Some of them go on to join the 200,000 foreign students who enter the labour force through the “optional practical training” programme every year—a figure which stayed high even under Donald Trump.
What makes American skills and size that much more potent is the third element in the mix: dynamism. This is often the attribute mentioned first by people trying to explain America’s success. It is also the one where definitions are sketchiest. But there are some clear correlates. Odd as it may sound for a country that created both Mr Burns, the vulture capitalist of Springfield, and Dilbert, the quintessential office drone, the quality of corporate management is another source of dynamism. Since 2003 John Van Reenen of theand Nicholas Bloom of Stanford have been attempting to provide analytical rigour to international comparisons of management by means of their World Management Survey. America sits at the top of their ranking.
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