The Great Divergence

Interesting figures on the “great divergence” – the huge widening in global inequality following the Industrial Revolution – from the annual economics symposium at Jackson Hole held by America’s Federal Reserve. According to a paper by Anthony Venables (PDF), a professor of economics at the London School of Economics: “the ratio of per capita incomes of the richest to the poorest nations increased from around 8:1 in 1870 to more than 50:1 in 2000.” Of course it would be wrong to conclude from these statistics that economic growth should be rejected. On the contrary, the poorer countries need more growth so that they can catch up.

For anyone interested more generally in the world economy the papers at Jackson Hole look worth reading.