Convergence on macro scale

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Convergence on macro scale발음듣기

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Voiceover: We've talked about things that might drive inequality, things that Thomas Picketty refers to as forces of divergence, but now lets think about, or at least some of what he cites, as forces of convergence.발음듣기

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Forces of convergence or things that might make the world a more equal place.발음듣기

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The primary one that he cites, is one that's very close to my heart, and this is the spread of knowledge.발음듣기

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Spread of knowledge. What we have here is a couple of charts that show the spread of knowledge at least on a macro basis, on a regional basis, and shows how it has been a driver of starting to equalize global output.발음듣기

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As we start in 1700, we see that it's going from 1700 through the Industrial Revolution, frankly as the West was developing or industrializing.발음듣기

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The West, Europe and America, became a larger and larger percentage of global output, and Asia became a smaller and smaller percentage.발음듣기

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But then as you go into the second half of the 20th century and into the 21st century, you see that dynamic change.발음듣기

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Asia's percentage of world output is increasing more and more.발음듣기

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That's arguably happening because you've had a transfer of knowledge, a diffusion of knowledge from the West to the East for modern manufacturing techniques and design techniques and engineering techniques and whatever else.발음듣기

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And that's why as we are in the beginning of the 21st century, Asia is turning into a major industrial powerhouse.발음듣기

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They've learned from the West and in some dimensions are even improving on some of the dynamics or some of the knowledge from the West to make themselves more and more productive.발음듣기

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So at least on a regional basis, this shows that the world is becoming more equal because of this spread of knowledge.발음듣기

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And we can also see it on a per capita basis.발음듣기

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This right over here is this is global- they're essentially plotting over time, per capita GDP as a percentage of world average.발음듣기

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The world average, right over here, is obviously 100% of the world average.발음듣기

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So that's why it's just a flat-line at 100%.발음듣기

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And we see as we go through the Industrial Revolution Europe and America, essentially the West, it's per capital GDP becomes a larger and larger percentage of the average per capita GDP for the globe.발음듣기

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But that was true until recently.발음듣기

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Until the last few decades, as a percentage it's gone down.발음듣기

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Now that doesn't mean that per capita GDP is going down, it just means that it's share as a percentage of world average is going down.발음듣기

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And that's really because Asia's per capita GDP has been growing even faster because of once again, that spread of knowledge.발음듣기

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At least, this idea of spread of knowledge, it does seem to be playing out at a regional level.발음듣기

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It's bring, at least right now, it seems like Asia's participating much more than Africa, but it's starting to bring the non-West, I guess the East more in line with the West in terms of productive capacity and wealth per person and per capita GDP, however you want to look at it.발음듣기

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Now an interesting question, that's a regional level, what about an individual level?발음듣기

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And we'll talk about that more in the next video.발음듣기

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