12 ms·
"GDP per head" is just another name for "productivity". And while they can scour the corners looking for untapped sources of productivity, that can't last forev
by Analemma_ 9y ago
"GDP per head" is just another name for "productivity". And while they can scour the corners looking for untapped sources of productivity, that can't last forever. Japan is staring down the wrong end of a simple equation:
GDP = Population * Productivity
and then take the derivative:
d(GDP)/dt ~ d(Population)/dt + d(Productivity)/dt
Meaning you can still have growth in periods of population decline, but it's really hard, especially in this era where we've plucked all the low-hanging fruit as far as increasing productivity. And the greater the rate of decline, the harder it gets. Japan's population decline is still very slow, all things considered, but will accelerate as it hits the middle of the logistic curve.
- smnrchrds 9y agoI hate to be that guy, but the derivative should be d(GDP)/dt = d(Population)/dt * Productivity + d(Productivity)/dt * Population
- Analemma_ 9y agoI'll be that guy too: that's why I used ~ and not = ;)
- thaumasiotes 9y agoBut ~ is wrong, unless you're assuming that productivity is necessarily equal to population. It's not really right even then, because the ratio between GDP' and 2(Population') is not constant but rather equal to (Population).
- yufeng66 9y agoI will be that guy too then :) People tend to use relative change: d(GDP)/dt / GDP = d(Population)/dt / Population + d(Productivity)/dt / Productivity So the relative change of GDP is still neatly separated into population growth component and productivity component.
- danmaz74 9y agoYou forgot one very important factor, Active Population Ratio GDP = Population * Active Population Ratio * Productivity If the population ages too quickly, the active population rate can go down very fast...