Finance, Forex and Investments

Why economist predicts US economy will decline while China And India will be on top by 2050?

US economy is one of the largest economy in the world now and they also have resource and all. Then how China and India can overtake US by 2050 ?

Public Comments

1. Because of difference in GDP growth rate. The US growth rate is under 2%, while India and China will grown 7-9%. You do the maths.
2. 1. It is fashionable to talk of the relative decline of the West and the resurgence of the East. My feeling is that aggregate GDP doesn't really matter. What matters much more is productivity (per capita GDP, etc.) Japan was the second largest economy for years, but didn't have much political clout. Russia was the other super-power, but didn't have much of an economy - it just used its income to project military power. 2. Both India and China now have economies that are growing at over 8% per year. The U.S. is now growing at under 2% per year and hasn't grown at more than 4% a year in decades. http://www.tradingeconomics.com/united-states/gdp-growth-annual If this disparity in growth rates continues, then, of course, China and India will first match, and then exceed the size of the U.S. economy. (In fact, at current rates, China will pull ahead in 2030. India is starting further back and has lower growth (only 8%) and so would take until 2050) Whether the growth rates will continue is another matter entirely. India was growing very slowly from independence through the early 1990s. Its economy has been growing rapidly for less than 20 years. Expecting it to continue growing rapidly for the next 40 years is a bit optimistic. China has been growing rapidly a little longer, but it too was, under a previous regime, growing very slowly. And who knows, there may well be a radical change in American politics and the economy would start growing rapidly again. (The Democrats do a better job on the economy, but they are being hampered by the Republicans) http://rodrik.typepad.com/dani_rodriks_weblog/2008/03/american-politi.html 3. On the other hand, both India and China have populations that are several times larger than the U.S. population. http://en.wikipedia.org/wiki/List_of_countries_by_population Even if the Indians and Chinese never come close to beating U.S. productivity levels, if the average Indian and Chinese produces half as much as the average American, the Indian and Chinese economies will each still be larger than the U.S. economies. 4. Fewer people actually expect an absolute (as opposed to a relative) decline of the U.S. economy. Those that do point to how heavily dependent the U.S. economy is on oil - much more so than most of Europe, Japan, etc. As the price of oil rises, that will put the U.S. economy at a relative disadvantage. http://network.nationalpost.com/np/blogs/francis/archive/2009/09/16/oil-prices-mean-perpetual-recession.aspx 5. Note, however, that if Europe were to unite tomorrow, then Europe would be the world's largest economy, not the U.S. No one is expecting Europeans to do that soon, but if you are concerned about the U.S. becoming #2, it can happen long before China does the job. As it is, in terms of standard of living, the U.S. used to be #1, but isn't any longer: http://streetlightblog.blogspot.com/2011/05/were-number-two.html http://www.prosperity.com/ That is a much more important change and threat to the future than India and China.
3. which economist predicts that? and, I'm sorry precisely what are they predicting? You really don't have a clue do you . . . . please turn Star Trek back on and leave the thiinking to the adults.