China News Agency reporter: Liu Yuying
How has humanity escaped the "poverty trap" throughout history? What is the fundamental driving force of human economic development? Why are there such great differences in living standards around the world? Odad Geller, a professor of economics at Brown University in the United States, answers these questions from the perspective of a unified growth framework in his book "The Human Journey: The Origins of Wealth and Inequality," published in China in China.
In 2022, the global economy is still in uncertainty. Pandemics, wars, energy crises, slowing economic growth... This will pose enormous challenges to humanity. Professor Odad Geller recently gave an exclusive interview to China News Agency's "East-West Question" to view the world of tomorrow from the perspective of growth.
The following is a summary of the interview:
China News Agency: You recently published the book "The Human Journey: The Origins of Wealth and Inequality", which was listed in China. What is this book focused on and what are the most important insights?
Odaid Geller: This book explores the evolution of human society since the emergence of Homo sapiens in Africa nearly 300,000 years ago. It solves two of the most fundamental mysteries surrounding this journey.
Mystery 1: The Mystery of Growth – After 300,000 years of near-stagnation, what are the roots of the dramatic changes in human living standards over the past 200 years? Why has world per capita income increased 14-fold and life expectancy more than doubled in the last 200 years, while these dimensions have made little progress in 300,000 years?
Myth 2: Inequality in growth – What are the root causes of the huge inequalities in living standards in different countries and regions, and why has this inequality increased dramatically over the past 200 years?
The book presents a revolutionary view of the origins of wealth and global inequality. It shows that much of the inequality in national wealth can be traced back to the workings of human history hundreds of years ago, thousands or even tens of thousands of years ago, in relation to institutions, cultural and geographical characteristics, and demographic diversity.
National Day flower beds with the theme of "coordinated development" along Chang'an Street in Beijing. Photo by Tian Yuhao
China News Agency: According to your unified growth framework, how to understand inequality between countries? Are these inequalities rising or falling?
Odaid Geller: The Unified Growth Theory holds that for most of human existence, innovation has contributed to economic prosperity for only a few generations. Finally, population growth has restored living conditions to subsistence levels. Technologically advanced societies have greater population density, but economies are not more prosperous. Thus, until the early 19th century, inequality in the world economy was moderate.
However, over the past two centuries, world per capita income has increased 14-fold, from stagnation to take-off, bringing with it great inequality among countries. The take-off occurred in some countries in the 19th century and many developing countries at the end of the 20th century, leading to great inequalities in national wealth.
But due to the decline in the rate of return on capital and the slowdown in technological progress, latecomers to modern economic growth, such as China, have grown very rapidly in recent decades, and inequality between some countries has subsided and will be further reduced.
On August 21, 2022, with the departure of the China-Europe Express (Xi'an-Hamburg) from Xi'an International Port Station, the cumulative number of China-Europe Express trains has reached 10,000 since 2022. Photo by Huang Xin
China News Agency: What impact will the ongoing new crown epidemic have on world economic growth? In the 14th century, the socio-economic development of Europe was greatly affected by the Black Death. Do you think the pandemic will also have such a serious impact on the economy?
Auded Geller: The pandemic has highlighted humanity's ability to address the major challenges it will face in the coming decades. It reminds humanity of its vulnerability and highlights the importance of international cooperation and transparency in an interdependent world.
In addition, the pandemic has created an important "experiment" that could have a lasting beneficial impact on the productivity of businesses and the well-being of their employees. It has forced companies to allow employees to work remotely, and people realize that in this way, the decline in productivity is not significant, and the benefits for employees are considerable. A new model of work may emerge that requires less office space, lower transportation costs, and less employee activity in the work environment.
At the China Import and Export Fair (Canton Fair), staff introduced products to buyers through live broadcasts. Photo by Chen Jimin
China News Agency: You mentioned that technological progress can be a catalyst for economic growth. There is a view that the pace of technological progress is slowing down, and rapid economic growth will not be achieved until the next round of technological revolution. Do you think technology development is at a tipping point? In which industry or sector will the next major shift in technology models take place?
Odaid Geller: I don't share the skepticism about the speed of technological progress in the future. I believe that the pace of technological progress will continue, and the wheel of change that has dominated the human journey will continue to turn. A greater focus on future directions and education, and respect for gender equality, diversity and differences, are key to prosperity. They will foster innovation, reduce social discontinuity, and mitigate current trends in climate change.
It may be too early to identify the core features of the next technological revolution, but it could include two important aspects: innovations that allow humans to extract cheaper, more environmentally friendly energy, and innovations that allow for significantly extending human life and improving human cognitive function.
On November 5, 2022, visitors experienced VR technology at Canon's booth in the technology and equipment exhibition area of the 5th China International Import Expo. Photo by Yin Liqin
China News Agency: In recent years, many countries have faced a population growth rate that is not optimistic. For example, China's birth rate in 2021 was only 7.52 per thousand. The whole world is suffering from similar problems. How will population issues affect the economic growth of these countries under your growth framework?
Odaid Geller: As long as the educational attainment and productivity of the young population increases significantly, that is, as long as the trade-off between quantity and quality is maintained, I believe that the projected population growth rate and eventually the decline in the world's population will benefit the world: pressures on the environment will subside, and the productivity of the young population will increase significantly, and may be enough to compensate for the decline in population size. This pattern will lead to growth in per capita income, despite the decline of the world's population.
According to the main data of China's seventh national census, the total population of Chinese mainland in 2020 was about 1.41 billion. The picture shows Guangxi Baise, leisure people in the park. Photo by Chen Guanyan
China News Agency: How did globalization affect economic growth after World War II? Will competition between China and the United States affect economic globalization?
Odaid Geller: Globalization has played an important role in the growth of the world economy, but current conflicts in some regions are jeopardizing this important trend. I hope that China and the United States will take credible political steps to build mutual trust and prevent the decline in globalization and its negative impact on the entire world economy. In fact, China's growth over the past few decades has been remarkable, benefiting itself and the world economy significantly.
Respondent Profile:
Oded Galor, founder of the Unified Growth Theory, Israeli-American economist, Herbert Goldberg Professor of Economics at Brown University, elected foreign member of the Academia Europaea and elected fellow of the Econometric Society, editor-in-chief of the Journal of Economic Growth, editor of the Journal of Population Economics.
Source: China News Service