eponymous: well, I’ve thought the same thing: India would probably be a longer-lasting rise, and may wind up being the real winner when all is said and done. But it will take them a very long time, because they do have all kinds of other problems, amongst which are a far more primitive infrastructure, from what I read. In the last election, the polls were wildly off in part because few pollsters could get to the backcountry there, because so many villages are only accessible by paths that no car can get to. Takes them a month to hold an election, which all by itself shows you how tough transportation is there.
Another thing not noted about the US: we’ve recently had a sharp rise in productivity. Based on the series for output for the entire nonfarm business sector (source over at the St Louis Fed ), year-over-year growth in productivity in the 90’s averaged 1.97%, as opposed to 1.41% during the 80’s. But the real story is what’s happened since 2000: 3.2% on average over the past 5 and a half years. Since the fourth quarter of 1997, there’s only been a few scattered quarters where growth has been less than 2%, and there’s been none where it’s been negative since the first quarter of 1995. That bodes very well for the long-term economic outlook of the US, which of course also means it could be a while before any of these rising Asian powers can seriously challenge us in that area. So this may wind up staying a unipolar world for quite some time.
This assumes that there won’t be a recession in the near future in the US during which the growth will be negative. It happened prior to 1995, and isn’t much of a stretch for happening again. Of course, if the US sneezes, the rest of world gets a cold.
Well, what’s intriguing is that it didn’t go negative during the recession we had in March - Nov 2001. The 2nd quarter of 2001 did see year-over-year growth in productivity dip to slightly less than 2%, but that was it. All by itself that’s more than a little interesting, and encouraging.
Not sure about transportation infrastructure being more primative (well, I guess compared to US and rest of developed world it is - but compared to China I would want to see some hard numbers). My understanding of the transportation infrastructure in India is that many rely on the rail systems - the road network is not as well developed and integrated as the rail network. Not certain of the telecommunications networks.
One thing about India that differs from China is the rate of urbanization. That is, China, over the last 20-30 years has seen a massive increase in rural-urban migration - partly as a response to but also a consequence of China’s economic policies (in fact, after checking a couple of sites, it’s been an explicit policy of the government to encourage rural-urban migration).
India, I would suspect (although I don’t have any hard evidence to back it up) hasn’t experienced such rapid urbanization. Sure, the urban areas in India have gotten larger, but so have the rural areas. While both China and India are still largely rural, the shift for China (in becoming more urbanized and less rural) has been much greater.
Would be curious to hear reasons for the rise in productivity, and whether the reasons for this rise (whatever they may be) can be sustained.