Y ou are require d to go to the Penn World Table website and collect data on re

Question

You are required to go to the Penn World Table website and collect data on real GDP per capita (Chained series) for 1980 and 2003 for at least ten countries of your choice. You could download the data using the link below.

http://datacentre2.chass.utoronto.ca/pwt62/alphacountries.html

a)Rank the countries according to GDP per capita in 1980. List the countries with the highest top 5 levels of GDP per capita in 1980. Are there any surprises?

b)Repeat the analysis in part (a) for 2003. Has the composition of the richest countries changed since 1980?

c)For each of the ten countries for which you collected data, divide the 2003 level of real GDP per capita by the level in 1980. Which of these countries has had the greatest proportional increase in GDP per capita since 1980?

d)Which country had the smallest proportional increase in GDP per capita?

e)Do a brief internet search on the country with the greatest growth in GDP per capita over time. Can you ascertain any reasons for the economic success, or lack of it, for this country?

Explanation / Answer

The following ten countries have been choosen -

Australia, Brazil, China, Germany, India, Japan, Saudi Arabia, South Africa, United States, and Zimbabwe.

(a) Following table shows the rank of countries according to GDP per capita in 1980 -

Following table shows the top 5 countries as per GDP per capita in 1980 -

There are surprises in the terms that Saudi Arabia has highest GDP per capita in 1980 even higher than United States and also Zimbabwe has higher GDP per per capita than India and even China.

(b) Following table shows the rank of countries according to GDP per capita in 2003 -

Following table shows the top 5 countries as per GDP per capita in 2003 -

The top 5 countries had remained same. However, their ranks have changed. Saudi Arabia which was ranked 1 in 1980 has become 5th ranked in 2003. US has become no. 1 country in 2003. Apart from this Australia (from 4th to 3rd), Germany (from 3rd to 2nd) and Japan (from 5th to 4th) has imporved on their rankings.

(c) Following is the required table -

Country

GDP per capita in 2003

(in dollars)

(A)

GDP per capita in 1980

(in dollars)

(B)

Proportional

Increase

(A/B)

United States

34,875.37

31,082.15

       1.61

Germany

25,188.15

21,606.15

1.43

Australia

27,871.9

17,613.58

1.59

Japan

24,036.74

17,463.94

1.54

Saudi Arabia

16,013.14

15,520.33

0.51

South Africa

8,836.35

7,578.09

1.16

Brazil

7,204.93

6,775.63

1.06

China

4,969.64

3,227.86

6.63

India

2,990.07

1,348.30

2.27

Zimbabwe

2,438.67

749.19

0.75

China has the greatest proportional increase in GDP per capita since 1980.

(d)Brazil has the smallest proportional increase in GDP per capita since 1980.

Important note - The GDP per capita level of Saudi Arabia and Zimbabwe has declined between 1980 and 2003.

Rank Country GDP per capita in 1980 (in dollars) 1 Saudi Arabia 31,082.15 2 United States 21,606.15 3 Germany 17,613.58 4 Australia 17,463.94 5 Japan 15,520.33 6 South Africa 7,578.09 7 Brazil 6,775.63 8 Zimbabwe 3,227.86 9 India 1,348.30 10 China 749.19

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