[经济学]chap019 Economic Growth.ppt

Human genome project is an interesting example here. NIH led the public project and all their findings are publicly available. A private company (Celera Genomics) also completed the gene sequencing but held back data on parts of the genome they believe could be commercialized. NIH started with a slower, lower risk approach to developing the sequence. Celera had a different, higher risk strategy that reduced costs and produced results faster. Celeras work cost $300 million while the NIH budget was $3 billion. (/wiki/Human_genome_project) * Micro-credit * Compound Interest Rates In 1870, Brazils GDP per capita was twice Ghanas By 2003, the multiple increased to 5 times Brazils growth over the period was 1.6% and Ghanas was 0.9% Compound interest pays interest on the original deposit and all previously accumulated interest Interest paid in year 1 earns interest in year 2 $10 deposited at 4% interest in 1800 is $31,033.77 in 2005 $10 x (1.04)205 = $31,033.77 Compound Interest Differences in interest rates matter Growth rates in GDP per capita have the same effect as interest rates Relatively small growth in GDP per capita has a very large effect over a long period In the long run, the growth rate of an economy matters Interest Rate (%) Value of $10 after 205 years 2 $579.48 4 $31,033.77 6 $1,540,644.29 Flash in the Pan or Baby Giant? China receives media attention for its growth China has 20.5% of the worlds population If growth is sustained, China could become the largest economy China produces half the worlds clothing and cement Largest producer of coal and steel China is largest consumer of copper, aluminum, and cell phones Second largest consumer of PCs Can this growth be sustained? China’s Share of World Consumption, 2002-2003 Population 20.5% Consumption of Pork 51% Cigarettes 35 Cotton 33 Fish 32 Steel 27 Televisions 23 Ice Cream 19 Washing Machines 18 Computers 6 Soda 4 Real GDP per Capita Notation Y = real GDP N = number of people employed POP =