The short run meets the long run robert gordon distinguishing between secular stagnation and slow longterm growth a set of lively debates about future u. Sep 02, 2012 im a big fan of much of the work of northwestern university economist robert j. This book was set in times roman by icc typesetting and was printed and bound in the united states of america. Then i turn to comments on each of the four contributions. Gordon s the rise and fall of american growth is a magisterial volume that will benefit any serious student of economics, demographics or history.
People had leapt on the pessimism about innovation, and people completely overlooked the fact that, by far, the biggest contributor to future growth is about headwinds. View notes robert gordon on economic growth 1 from econ 300 at new york university. Secular stagnation refers not to the literal stagnation, i. Judging from all the hype, the economic book of 2016 is robert gordons the rise and fall of american growth. Jan 31, 2016 in the rise and fall of american growth, robert j. Gordon has long been associated with the view that future economic growth will be slower than that of the fairly. Between 1891 and 2007, the nation achieved a robust 2% annual growth rate of output per person. Its point of departure is growth in percapita real gdp in the frontier country since 0, the u.
The rise and fall of american growth is a comprehensive survey of the growth of living standards in the united states from 1870 to 2014, and a projection of growth rates for future decades. This can be seen in the world percapita gdp from 1700 to the present. Hundred eleventh annual meeting of the american economic association may. Why has economic growth slowed when innovation appears to. Sixty years later we travelled at 80% of the speed of sound in a boeing continue reading.
Faltering innovation confronts the six headwinds, is no exception. He is the author of a textbook in intermediate macroeconomics, now in its 12th edition, and has completed a new book, the rise and fall of american growth, published by the princeton. Robert gordon on economic growth 1 nber working paper. Robert gordon, the special century, and the prospects for. I am not making a major new claim about the rate of innovation. Robert gordon, a celebrated economic historian and northwestern university professor, addresses these questions in his magisterial new book, the rise and fall of american growth. Faltering innovation confronts the six headwinds, centre. Rise and fall of american growth, the the princeton. A major theme of the book is that real gdp, the numerator of output per hour, greatly understates the improvement in the standard of living, particularly for the united states in the special 18701970 century. In contrast, in early 2015 the output gap is small and shrinking, while productivity growth over the past five years has been only a fraction of the rate achieved in the late 1930s. First, changes in real gdp omit many dimensions of improvement in. When economist robert gordon categorized the three phases of industrial revolution, he designated the first phase as the period between 1750 and 1830, when the steam engine, mechanized cotton spinning, and railroads were invented. Measured between quarters with identical unemployment rates, u. Sep 11, 2012 but the point of this article is that it is likely to be much worse than any epoch of us growth since the civil war.
American economic association northwestern university. Indeed, my main criticism is that his bottom line is implausible. Library of congress cataloginginpublication data barro, robert j. Is it the result of unwise policies or unfavorable demographics, or is it the comedown that naturally occurs after a.
Robert j gordon northwestern university and cepr cepr policy insight no. Standard of living since the civil war the princeton economic history of the western world book 70 kindle edition by gordon, robert j. Sixty years later we travelled at 80% of the speed of sound in a boeing 707. It questions the assumption, nearly universal since solows seminal contributions of the 1950s, that economic growth is a continuous process that will persist forever.
In his paper robert gordon talks about the huge value gained from onetime events, such as the onetime first and last move of a large proportion of women into the workforce. Robert gordons the rise and fall of american growth set out a thesis of technological diminishing returns that does much to explain an age of economic pessimism. Dec 22, 2015 robert gordon, the special century, and the prospects for economic growth december 22, 2015 by laurence siegel is the slowdown in economic progress in this new century an aberration or should we have expected it all along. Gordon department of economics, northwestern university. The decline of innovation and economic growth robert j.
Gordons book offers the definitive account of how the many technological innovations between 1870 and 1940 dramatically improved life in the united states. The average american family of 1870 would have been astounded by the living standards of their 1970 descendants. This productivity slowdown has eluded many attempts to provide singlecause explanations. The paper is only about the united states and views the future from 2007 while pretending that the financial crisis did not happen. Perspectives on the rise and fall of american growth by robert j. The rise and fall of american growth hashtag for twitter users. Department of economics northwestern university kellogg global hub 2211 campus drive. Gordon it is now 25 years since the growth rate of labor productivity and of multifactor produc tivity mfp decelerated sharply both in the united states and in most other industrialized nations. In 1900 travel was via the open buggy, at 1% the speed of sound.
Gordon nothing has been more central to americas selfconfidence than the faith that robust economic growth will continue forever. Be sure to watch the opposing viewpoint from erik brynjolfsson. The rise and fall of american growth princeton university press. Why robert gordon thinks growth is over washington post. Northwestern economics professor robert gordon has a written a mostly very good and a very long book 762 pages in the print edition on the history of economic growth in the united states. The real cause of american growth hoover institution. Faltering innovation confronts the six headwinds robert. Faltering innovation and the six headwinds gordon, 2012. Robert gordon s tome on american economic growth stretches to 768 pages and its central message is arguably more important. Introduction the prospects for future longrun us economic growth were already dismal in 2007 but were little noticed in the continuing euphoria over. But, most notable is the claim that the period 18701970. Use features like bookmarks, note taking and highlighting while reading the rise and fall of american growth.
The new \endogenous growth theories have focused on productivity advances that derive from technological progress and increased human capital in the form. So the more free human minds there are, the faster the economy will grow. This productivity slowdown has eluded many attempts to provide singlecause. This paper concerns only the us and has no necessary implications for other countries, which face a different mix of headwinds. D24,e2,e66,j11,j15,o3,o31,o4,q43 abstract this paper raises basic questions about the process of economic growth.
Robert gordon contends that the nations productivity growth. Gordons claim that the united states is bound for medieval productivity growth the first part of gordons paper lays out his claim that productivity and gdp growth of a level above 0. Unfortunately, the evidence suggests to me that future economic growth will achieve at best half that. This paper raises basic questions about the process of economic. Faltering innovation confronts the six headwinds, cepr policy insight no 63.
The paper begins with an examination of longrun growth back to 0 in the context of the three industrial revolutions. Development of the american economy, economic fluctuations and growth, productivity, innovation, and entrepreneurship. The assumption that there is a uniquely correct or at least a. Faltering innovation confronts the six headwinds robert j. Start by assuming that future innovation propels growth in percapita real gdp at the same rate as in the two decades before 2007, about 1.
He is known for his work on productivity, growth, the causes of unemployment, and airline economics. Perspectives on the rise and fall of american growth. Economist robert gordon lays out 4 reasons us growth may be slowing, detailing factors like epidemic debt and growing inequality, which could move the us into a period of stasis we cant innovate our way out of. This new gain happens only once assuming they remain. Economist robert gordon lays out 4 reasons us growth may be slowing, detailing factors like. Gordon says that increased taxes on pollution and increased concern with energy will lead to lower growth. Apr 23, 20 the us economy has been expanding wildly for two centuries. Faltering innovation confronts the six headwinds, nber working papers 18315, national bureau of economic research, inc. Thats the provocative question that economist robert j. The book is magisterial in the scope of its account of the history of growth. Gordon has written prolifically about the problems facing contemporary economic growth, casting a sobering doubt on the ability of our current innovations what he calls the third industrial revolution, including all our fancy gadgets to power the economy the way previous waves of invention. Robert gordons the rise and fall of american growth.
Any consideration of us economic progress in the future must look beyond the pace. Robert gordon is a macroeconomist with a particular interest in unemployment, inflation, and both the longrun and cyclical aspects of labor productivity. Economist robert gordon lays out 4 reasons us growth may be. The us economy has been expanding wildly for two centuries. Two further thoughts on robert gordon sep 10th 2012, 10. Babyboomer retirement the reversal of the demographic dividend brings us down to. This paper predicts that growth in the 25 to 40 years after 2007 will be much slower, particularly for the great majority of the population. This paper raises basic questions about the process of economic growth. Gordon declares that the kind of rapid economic growth we still consider our due was in fact a onetimeonly event. Robert gordons the rise and fall of american growth is an extraordinary work of economic scholarship. There was virtually no growth before 1750, and thus there is no guarantee.
Gordon uses china as an example of the growth that is possible if environmental regulations were reduced in the united states. However, the shortrun growth that china has enjoyed has little to do with lax environment regulations. Gordon has long been associated with the view that future economic growth will be slower than that of the fairly recent past. The 2012 paper, and even more this paper, are careful to distinguish forecast economywide productivity growth of 1. American economic history g force books and arts the. Moreover, this is one of the rare economics books that is on the one hand deeply analytical. There was virtually no growth before 1750, and thus there is no guarantee that growth will continue indefinitely.
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