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Is anyone else troubled by the historical graph of global GDP? It looks to me like your typical deceptive hockey stick graph specifically design to shock the pu

Is anyone else troubled by the historical graph of global GDP? It looks to me like your typical deceptive hockey stick graph specifically design to shock the public. First, GDP is a total amount, not a per-capita figure. The population has grown dramatically, so even if everyone throughout history was equally wealthy, the graph would still have the same general shape. Second, even though the scale on the left side is equally divided into $20T increments; going from 0 to $20T is not the same as going from $20T to $40T. Exponential growth is required to achieve the first milestone. A mere doubling gets you to the second one.

amalcon 2y ago
If you go to their source, you also see that there are only 3 data points in the first 75% of the graph. This makes sense, since obviously global GDP can only be very roughly estimated in e.g. 1000AD. It kind of raises the question of whether GDP is even a coherent concept in 1000AD. However, the post-1500 numbers are going to be at least somewhat reliable, and can be inspected at the source: 1500: 502.98G 1600: 671.14G (0.29% annualized growth) 1700: 751.59G (0.11%) 1820: 1.40T (0.52%) 1850: 1.85T (0.93%) 1870: 2.35T (1.2%) 1900: 4.19T (2.9%) (skipping a bunch because it's pretty high res now) 2000: 68.44 (2.8%) There are periods of faster and slower growth in those years -- most evidently, growth slowed between 1940 and 1950 for geopolitical reasons -- but that's at least the average. There is clearly something interesting going on between 1700 and 1900, with the significantly positive second derivative. However, that interesting thing is called the industrial revolution. The industrial revolution fits the article's narrative pretty well, and it's probably safe to assume their readers are aware of it. I don't know why they went this route rather than just pointing to the industrial revolution as evidence.
- abdullahkhalids 2y ago
  In the past, more than today, a lot of material benefits to people were provided via baked in social relations and other ways of life, and not via monetary exchange. For example, paying someone to take care of your kids is not something that happened when extended families lived with each. This was not included in past (or today's gdp). Similarly, if you grow part of your own food, then that's not included in the gdp. Past estimates of GDP largely only account for monetary exchanges, and not for stuff like the above. So they grossly underestimate how "wealthy" people were. I have seen several recent papers that try to correct for this.
  - didgetmaster 2y ago
    I agree. I believe that until the past century, the default behavior was to provide the majority of your family's needs yourself and only go outside of that for a small portion where money would exchange hands. People lived on family farms where they grew their own food, made their own clothes, and built their own shelter. It is not clear in the article if barter was considered in past GDP numbers (e.g. "I'll trade you my cow for the wagon you built.") These days everyone works for cash and often pays for services that they could easily do themselves.
anotherape 2y ago
Yeah also it is a measure of money not wealth. Daycare increases GDP. Grandma doesn't. That is probably a small issue but worth mentioning. I am more convinced when people point out potential weaknesses in their argument but few do this.
saghm 2y ago
Agreed, that was the weirdest part of the article for me. Given that the example of "why is there poverty?" was given as coming from a child in school, I think the author also is misunderstanding what the question even was by using a definition of "poverty" that's defined entirely by modern standards and applying it historically. If a child asked that question, telling them "it's the default state because back 1000 years ago even royalty were poor by our standards" doesn't help them understand what they actually wanted to know, which is "why do some people have a less money than others?". This isn't a uniquely modern phenomenon (although the exact distribution over time of course isn't static). Reframing the question based on an academic definition of "poverty" might be technically correct, but it's not helpful in the context it was asked. Ironically, the author seems quite smug about knowing better, saying "It is a childish question, one which betrays a naive, uninformed understanding of economics and history". It seems more like they betrayed a naive, uninformed understanding of children to so grossly miss the point of what they were actually asking. If their reaction to an intellectually curious child is to dunk on them for not precisely framing their question according to academic definitions of terms, it's not surprising that they think "ignorance and misrepresentations" are the "default state of humanity".
- didgetmaster 2y ago
  My definition of poverty has been that you do not have enough money to meet the basic needs of yourself and your family if you have one. It is not just because you have less than others.
  - saghm 2y ago
    I don't disagree with you, but from my reading the article's definition is entirely impossible to reconcile with this: > The reason is that nothing is puzzling about poverty. It is humanity's default state. Until very recently, everyone lived in what would now be regarded as shocking poverty. Even the elites—monarchs, aristocrats, and so on—lived in conditions that were appalling relative to the prosperity enjoyed by most people in affluent societies today. This is what I meant by the author reframing the question to the point where it feels like they completely missed the point. Your definition would be totally compatible with the way I think a child asking "why is there poverty?" is using the word, but I don't see how anyone could argue that "the elites—monarchs, aristocrats, and so on" were completely unable to meet their needs at any point before between the years 1-1500 CE, which the author describes as this: > The long, flat line that characterises most of human history? That is poverty: crushing, subsistence-level, Malthusian poverty.
armada651 2y ago
Also just because the GDP is low doesn't mean everyone is living below the poverty line. Even with a low GDP a king can still hoard most of the wealth and live in luxury. It's puzzling why the writer would assume an equal distribution of wealth in the age of kings and aristocrats of all things.

amalcon 2y ago

If you go to their source, you also see that there are only 3 data points in the first 75% of the graph. This makes sense, since obviously global GDP can only be very roughly estimated in e.g. 1000AD. It kind of raises the question of whether GDP is even a coherent concept in 1000AD. However, the post-1500 numbers are going to be at least somewhat reliable, and can be inspected at the source: 1500: 502.98G 1600: 671.14G (0.29% annualized growth) 1700: 751.59G (0.11%) 1820: 1.40T (0.52%) 1850: 1.85T (0.93%) 1870: 2.35T (1.2%) 1900: 4.19T (2.9%) (skipping a bunch because it's pretty high res now) 2000: 68.44 (2.8%) There are periods of faster and slower growth in those years -- most evidently, growth slowed between 1940 and 1950 for geopolitical reasons -- but that's at least the average. There is clearly something interesting going on between 1700 and 1900, with the significantly positive second derivative. However, that interesting thing is called the industrial revolution. The industrial revolution fits the article's narrative pretty well, and it's probably safe to assume their readers are aware of it. I don't know why they went this route rather than just pointing to the industrial revolution as evidence.

abdullahkhalids 2y ago
In the past, more than today, a lot of material benefits to people were provided via baked in social relations and other ways of life, and not via monetary exchange. For example, paying someone to take care of your kids is not something that happened when extended families lived with each. This was not included in past (or today's gdp). Similarly, if you grow part of your own food, then that's not included in the gdp. Past estimates of GDP largely only account for monetary exchanges, and not for stuff like the above. So they grossly underestimate how "wealthy" people were. I have seen several recent papers that try to correct for this.
- didgetmaster 2y ago
  I agree. I believe that until the past century, the default behavior was to provide the majority of your family's needs yourself and only go outside of that for a small portion where money would exchange hands. People lived on family farms where they grew their own food, made their own clothes, and built their own shelter. It is not clear in the article if barter was considered in past GDP numbers (e.g. "I'll trade you my cow for the wagon you built.") These days everyone works for cash and often pays for services that they could easily do themselves.

anotherape 2y ago

Yeah also it is a measure of money not wealth. Daycare increases GDP. Grandma doesn't. That is probably a small issue but worth mentioning. I am more convinced when people point out potential weaknesses in their argument but few do this.

saghm 2y ago

Agreed, that was the weirdest part of the article for me. Given that the example of "why is there poverty?" was given as coming from a child in school, I think the author also is misunderstanding what the question even was by using a definition of "poverty" that's defined entirely by modern standards and applying it historically. If a child asked that question, telling them "it's the default state because back 1000 years ago even royalty were poor by our standards" doesn't help them understand what they actually wanted to know, which is "why do some people have a less money than others?". This isn't a uniquely modern phenomenon (although the exact distribution over time of course isn't static). Reframing the question based on an academic definition of "poverty" might be technically correct, but it's not helpful in the context it was asked. Ironically, the author seems quite smug about knowing better, saying "It is a childish question, one which betrays a naive, uninformed understanding of economics and history". It seems more like they betrayed a naive, uninformed understanding of children to so grossly miss the point of what they were actually asking. If their reaction to an intellectually curious child is to dunk on them for not precisely framing their question according to academic definitions of terms, it's not surprising that they think "ignorance and misrepresentations" are the "default state of humanity".

didgetmaster 2y ago
My definition of poverty has been that you do not have enough money to meet the basic needs of yourself and your family if you have one. It is not just because you have less than others.
- saghm 2y ago
  I don't disagree with you, but from my reading the article's definition is entirely impossible to reconcile with this: > The reason is that nothing is puzzling about poverty. It is humanity's default state. Until very recently, everyone lived in what would now be regarded as shocking poverty. Even the elites—monarchs, aristocrats, and so on—lived in conditions that were appalling relative to the prosperity enjoyed by most people in affluent societies today. This is what I meant by the author reframing the question to the point where it feels like they completely missed the point. Your definition would be totally compatible with the way I think a child asking "why is there poverty?" is using the word, but I don't see how anyone could argue that "the elites—monarchs, aristocrats, and so on" were completely unable to meet their needs at any point before between the years 1-1500 CE, which the author describes as this: > The long, flat line that characterises most of human history? That is poverty: crushing, subsistence-level, Malthusian poverty.

armada651 2y ago

Also just because the GDP is low doesn't mean everyone is living below the poverty line. Even with a low GDP a king can still hoard most of the wealth and live in luxury. It's puzzling why the writer would assume an equal distribution of wealth in the age of kings and aristocrats of all things.