Today in class we learned about how how amazing it is of the progress we have made as a global economy in the last 100 years compared to the thousands of years proceeding the 20th century. Though there were a lot of big technological improvements for the first couple of years of earth, the average income of people did not change.
The industrial revolution helped to jump start the progression of man in the 18th century. Before the revolution, there weren't social classes. Minus the political leaders, almost everyone had around the same amount of income. If the average income kept accelerating at the rate it did before the industrial revolution, the average american would make around $10,000 today. This wouldn't be as bad as it seems since products would be significantly cheaper than they are today to accommodate to what people can afford to pay for products. A great formula that we learned is the rule of 72. This when you take 72 over the amount of percent return that you expect to get. The answer is the amount of time it will take for your investment to double. Rizzo discussed how humans are growing faster than the population has both financially and economically. There use to be a thought amongst people that if people produce more things than it will take away from each other's profits. Realistically it will just help because people will trade for each others products. This was when products used to be produced at an extremely slow rate.
The two major events that sparked growth in the world were the agricultural revolution which happened 500 years ago and the industrial revolution. The agricultural revolution increased the rate of production of food. THis helped to replace the previous techniques for food of hunting and gathering. The biggest economic ump came from the industrial revolution. during this, the world income doubled every 30-40 years. It has increased even more today doubling every 15 years. by the year 2040, the worlds growth rate will increase 6% every year. 8% by 2042. Annual growth rate will increase by 500% after this where income will double every 2 weeks.
Although there are many people who live in poverty, only a few live in poverty conditions similar to pre industrial revolution. This is because so many things that would be considered a big expensive thing in earlier years is now almost a guaranteed for all living people.
The availability of products have made huge strides in the last 200 years as well. On any given day in New York City, an individual can find 10 billion products. One concern that goes along with the amount of products available is that the world will run out of room for people. This has been proven wrong several times and professor Rizzo believes that the world could support 1 trillion people if we wanted to. currently there are 685 billion people on earth. Many of the technological increases that we make go towards finding a way to feed more people.
In the last 200 years, the world GDP has increased by 65 times the amount from 1 trillion to 65 trillion. The greatest movement of people is currently happening. Everyone helps each other get richer. So in the end every one gets rich together. There are currently 500 million people living in the worlds poorest poverty category. This is an 80% reduction in the last 40 years. This is great news for the worlds economics because it means that more people have money to spend to stimulate the economy. Of these 500 million people, 152 million of them live on less than a dollar a day. This is an unbelievable stat to think about considering a person in America wouldn't last a month on less than a dollar a day.
Something amazing to think about is that singapore who has almost no natural resources to trade is richer than America today. Also, an average person today has more in common with Bill Gates, the richest man in the world than an average person from 100 years ago. This is because there are similar products that Bill Gates and we have, the only difference is the quality and the full service that they provide. Normal things taht we have today didn't exist 100 years ago.
Human progress always come along with enemies. We can't listen to these enemies while moving forward or else we won't move forward.
No comments:
Post a Comment