US and the World Economy GDP One of the ways to measure the size of the economy Changes yearly but rankings of countries do not change dramatically with some exceptions US biggest in economic output China is number 2 China has rocketed into the rankings until 3 years ago Japan was second but China is on a very high growth rate Consistent measure across countries all calculated the same way GDP by state gross state product o Measured the same way o California Texas New York o GDP Growth Ratess China s Growth Rate not stable volatile still an emerging country infrastructure still has to catch up people who invest money don t like to see this they want to invest in more stable economies in developed countries India too HDI Human Development Index Quality of Life Measure GDP is only economic output want to look at country as a whole o Standard means of measuring well being Life expectancy Literacy Education Standard of living GDP per capita o Used to determine and indicate whether a country is developed developing or underdeveloped o Exposes some disconnect between economic well being and quality of life OECD Organization for Economic Cooperation and Development International Organization of 30 countries that accept the principles of representative democracy and free market economy Most members are high income economies with a high HDI and regarded as developed Not something automatically open to applicant countries decision taken at end of deliberation by member countries is called accession process China not included if you become a member there are certain regulations trade environment China wants to stay developing so they re not constrained G7 Meeting of Finance ministers from the group of seven industrialized nations Decisions made at the g7 mettings have enormous repercussions for the rest of the world Also g8 plus Russia Used to be the worlds biggest economies just stuck Fertility Rates How many babies a woman gives birth to across every single OECD country fertility has gone down Countries that face imminent population decline basically have to encourage women to have babies extended maternity leave for both parents tax breaks childcare facilities Blip in Japan in 1966 because it was the year of the horse and if a woman is born in that year she is said to never get married GDP Per capita GDP divided by population Norway first has a lot of oil and very little population Income Distribution A lot of very rich lot of very poor spread out US More compressed not that many poor or very rich Scandinavian Countries If there are ways for people to move up there is a lot of social mobility US Redistribution of wealth Sweden Labor Unions Workers becoming weaker management getting stronger Working weeks 10 weeks lower in Sweden than US people in US like to make money swedes value leisure o Output productivity x input o GDP P productivity x T time input o Since input is 15 lower the productivity has to be higher it is but it is not 15 higher If they worked a little more they would have a GDP like the US Tax Rates Many people in US say taxes are too high across these OECD countries US is lowest other than Japan Sweden is really really high More taxes more money spent on social welfare programs Disposable income is about the same because in Sweden they take a lot of taxes but in US we pay a lot for childcare healthcare etc US likes more pay as you go Healthcare spending o Way higher in US supposed to be more efficient because we have choices but the market has failed instead of bringing down prices they boost it up with spending money in the wrong places Infant Mortality Rates Obesity Imprisonment really high in US imprisonment off the charts CO2 emissions o When this came out US was highest polluter but this is only OECD countries China overtook US