WASHINGTON, DC – Slowly but surely, the debate about the nature of economic growth is entering a new phase. The emerging questions are sufficiently different from those of recent decades that one can sense a shift in the conceptual framework that will structure the discussion of economic progress – and economic policy – from now on.
The first question, concerning the potential pace of future economic growth, has given rise to serious disagreement among economists. Robert Gordon of Northwestern University, for example, believes that the US economy will be lucky to achieve 0.5% annual per capita growth in the medium term. Others, perhaps most carefully Dani Rodrik, have developed a version of growth pessimism for the emerging economies. The key premise, common to many of these leading analysts, is that technological progress will slow, including the catch-up gains that are most relevant for emerging and developing countries.