China will overtake the U.S. as world’s top economy in 2020, says Standard Chartered Bank
The report also predicts India's economy will surpass the U.S. by 2030.
- The Standard Chartered Bank, a British multinational banking and financial services company, recently issued a report to clients outlining projections about the world economy up until 2030.
- The report predicts Asian economies will grow significantly in the next decade, taking seven of the top 10 spots on the list of the world's biggest economies by 2030.
- However, the researchers formed their predictions by measuring purchasing power parity at GDP, which is an approach that not all economists would use in these kinds of projections.
China is poised to overtake the United States as the world's top economy as early as next year, according to a new report by the Standard Chartered Bank. Its analysts discovered this new status by surveying countries' purchasing power parity (PPP) exchange rates and nominal GDP.
The shakeup will be fueled largely by a strengthening of the middle class in Asian countries, suggests the report, which was covered by MarketWatch. "The global middle class is at a tipping point," Standard Chartered researcher Madhur Jha said in the report. "By 2020, a majority of the world population will be classified as middle class. Asia will lead the increase in middle-class populations even as middle classes stagnate in the West."
India is also estimated to overtake the U.S. economy by 2030, largely thanks to rapid urbanization.
"India will likely be the main mover, with its trend growth accelerating to 7.8 percent by the 2020s partly due to ongoing reforms, including the introduction of a national goods and services tax (GST) and the Indian Bankruptcy Code," Standard Chartered said.
The researchers wrote that Asia will see significant economic growth as the size of economic output begins to match the size of population."Our long-term growth forecasts are underpinned by one key principle: countries' share of world GDP should eventually converge with their share of the world's population, driven by the convergence of per-capita GDP between advanced and emerging economies," the report states.
Meanwhile, the researchers predicted that the economies of Europe and the U.S. will continue to grow, albeit at a slower rate, and that wealth inequality will continue to worsen in the U.S.
Visual Capitalist created a graphic that illustrates the report's projections for how the world's top economies will stack up in 2030.
If the predictions come true, countries such as Canada, France, and the U.K. would be edged out of the top 10 global economies.
Not so fast: Different measurements keep the U.S. on top
It's important to note that the report forms its predictions by measuring PPP at GDP, while some economists would use market exchange rates instead of PPP (you can read about the differences in these economic approaches here).
"By [using simple market exchange rates] the U.S. is still today the world's biggest economy, with a $7 trillion lead over China," wrote Ben Chu for The Independent. "Using market exchange rates rather than PPP would also most likely change the 2030 picture. The International Monetary Fund does not forecast beyond 2023, but at this date the Fund thinks the U.S. will still be the world's largest economy at market exchange rates and that the U.K. will still have a comfortable lead over the likes of Indonesia, Turkey, Brazil, Russia and the rest with little evidence of catchup."
Chu continued: "The reason why China is larger than the U.S. at PPP exchange rates is because it has a population four times larger. If one measures GDP at PPP per person a very different picture emerges, with China on $18,000 and the US on $63,000."
What's more, the most important thing to keep in mind when considering these kinds of economic predictions is probably the fact that none of these measurements necessarily gives you an accurate picture of the standards of life in a given country. So, just because a country has a bigger economy doesn't necessarily mean it has more freedom, higher wellbeing or better institutions.
Join Radiolab's Latif Nasser at 1pm ET on Monday as he chats with Malcolm Gladwell live on Big Think.
University of Utah research finds that men are especially well suited for fisticuffs.
- With males having more upper-body mass than women, a study looks to find the reason.
- The study is based on the assumption that men have been fighters for so long that evolution has selected those best-equipped for the task.
- If men fought other men, winners would have survived and reproduced, losers not so much.
Built for mayhem<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjY2NDIyMy9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYxMzk4NTQ2OX0.my6nML12F3fEQu3H4G0BScdqgaMZkRQHxgyj-Cmjmzk/img.jpg?width=980" id="906fc" class="rm-shortcode" data-rm-shortcode-id="dd77af7a881631355ed8972437846394" data-rm-shortcode-name="rebelmouse-image" />
Image source: Ollyy/Shutterstock<p>The researchers are, of course, talking averages here, not stating a rule: There are plenty of accomplished female pugilists, as well as lots of males who have no idea how to throw a punch.</p><p>Even so, says co-author <a href="https://www.wofford.edu/academics/majors-and-programs/biology/faculty-and-staff" target="_blank">Jeremy Morris</a> says, "The general approach to understanding why sexual dimorphism evolves is to measure the actual differences in the muscles or the skeletons of males and females of a given species, and then look at the behaviors that might be driving those differences."</p><p>Carrier has been interested in the idea that millennia of male fighting has shaped certain structures in male bodies. Previous research has reinforced his hunch:</p> <ul> <li><a href="https://jeb.biologists.org/content/216/2/236" target="_blank">When a hand is formed into a fist, its structure is self-protective</a>.</li> <li><a href="https://unews.utah.edu/flat-footed-fighters/" target="_blank">Heels planted firmly on the ground augment upper-body power</a>.</li> <li><a href="https://www.ncbi.nlm.nih.gov/pubmed/24909544" target="_blank">A study examined facial bone structure as being especially well-suited for taking a punch</a>.</li> </ul> <p>(That last one is our favorite. Do you know the German word "<a href="https://www.urbandictionary.com/define.php?term=Backpfeifengesicht" target="_blank">backpfeifengesicht</a>?" It's an adjective describing "a face that badly needs a punching.")</p><p>"One of the predictions that comes out of those," asserts Carrier, "is if we are specialized for punching, you might expect males to be particularly strong in the muscles that are associated with throwing a punch."</p>
Testing the theory<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjY2NDIzMy9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYwNzMxMTE2MH0.UXJICMy57UPYUWskhK98alctOrPidJL9yxMkz3HDQrM/img.jpg?width=980" id="98718" class="rm-shortcode" data-rm-shortcode-id="b12287684ac3e740b70392e6433a6b8f" data-rm-shortcode-name="rebelmouse-image" />
Image source: Ollyy/Shutterstock<p>The researchers measured the punching — and spear-throwing — force of 20 men and 19 women. The assumption was that early humans were punchers <em>and</em> spear-throwers.</p><p>Prior to testing, each participant had filled out an activity questionnaire so that "we weren't getting couch potatoes, we were getting people that were very fit and active," says Morris.</p><p>For punching, participants operated a hand crank that required movement similar to throwing a haymaker. The purpose of the hand crank was to spare participants any damage that might be inflicted on their fists by throwing actual punches. Subjects were also measured pulling a line forward over their heads to assess their strength at throwing a spear.</p><p>Even though all of the participants, male and female, were routinely fit, the average power of males was assessed as being 162% greater than females. There were no gender differences in throwing strength recorded. Other untested, though presumably likely, hand-to-hand combat activities come to mind including tackling, clubbing, running, kicking, scratching, and biting.</p><p>Carrier's takeaway: "This is a dramatic example of sexual dimorphism that's consistent with males becoming more specialized for fighting, and males fighting in a particular way, which is throwing punches."</p>
Boys will be boys<p>It, er, strikes us as odd that, even in science fiction — hi-tech weaponry notwithstanding — the hero <em>is</em> going to wind up duking it out with some bad guy, or alien, in the climactic battle. What is it about men punching, anyway? Are they more sexually attractive? The study suggests so:</p><p style="margin-left: 20px;"><em>The results of this study add to a set of recently identified characters indicating that sexual selection on male aggressive performance has played a role in the evolution of the human musculoskeletal system and the evolution of sexual dimorphism in hominins.</em></p><p>It's tough to contribute to the gene pool after being killed in battle.</p><p>Also, while the authors aren't <em>quite</em> saying that males' historical fighting role is mandated by biology and not by social expectations, neither are they quite <em>not</em> saying it.</p><p>As Carrier explain to <a href="https://attheu.utah.edu/facultystaff/carrier-punch/" target="_blank">theU</a>: "Human nature is also characterized by avoiding violence and finding ways to be cooperative and work together, to have empathy, to care for each other, right? There are two sides to who we are as a species. If our goal is to minimize all forms of violence in the future, then understanding our tendencies and what our nature really is, is going to help."</p>
The Labour Economics study suggests two potential reasons for the increase: corruption and increased capacity.
Cool hand rebuke<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNDQyMTIyNy9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY0NjY1NTYyOH0.0MCPKN3If94mYCNf3mMNrnTvJXjXN_bKLhgk9203EXk/img.jpg?width=917&coordinates=0%2C0%2C0%2C0&height=453" id="1627b" class="rm-shortcode" data-rm-shortcode-id="6d76421ba1ea0de4b09956b97e80c384" data-rm-shortcode-name="rebelmouse-image" />
A chart showing prison population rates (per 100,000 people) in 2018. The United States has the highest rate of incarceration in the world.
Who profits with for-profit prisons?<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="97ac37e6c7f6f22ec130ea2d56871701"><iframe type="lazy-iframe" data-runner-src="https://www.youtube.com/embed/dB78NV2WpWc?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span><p>The Labour Economics study suggests that privately-run prisons do convicts a few favors at the moment of sentencing. However, proponents of private prisons often point to other benefits when making their case. Specifically, they argue that private prisons reduce operating costs, stimulate innovation in the correctional system, and reduce recidivism—the rate at which released prisoners are rearrested and return to prison.</p><p>In regard to recidivism, the research is mixed. <a href="https://journals.sagepub.com/doi/abs/10.1177/0011128799045001002" target="_blank">One study</a> compared roughly 400 former prisoners from Florida, 200 released from private prisons and 200 from state-run facilities. It found the private-prison cohort maintained lower rates of recidivism. However, <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1745-9133.2005.00006.x" target="_blank" rel="noopener noreferrer">another Florida study</a> found no significant rate differences. And two other studies—one from <a href="https://journals.sagepub.com/doi/abs/10.1177/0011128799045001002" target="_blank" rel="noopener noreferrer">Oklahoma</a> and another out of <a href="https://journals.sagepub.com/doi/abs/10.1177/0734016813478823" target="_blank" rel="noopener noreferrer">Minnesota</a>, both comparing much larger cohorts than the first Florida study— found that prisoners leaving private prisons had a greater risk of recidivism.</p><p>The research is also inconclusive regarding cost savings. <a href="https://www.hamiltonproject.org/assets/files/economics_of_private_prisons.pdf" target="_blank" rel="noopener noreferrer">A Hamilton Project analysis</a> noted that such comparisons are difficult because private prisons, like all private companies, are not required to release operational details. In comparing what studies were available, the authors estimate the costs to be comparable and that "in practice the primary mechanism for cost saving in private prisons is lower salaries for correctional officers"—about $7,000 less than their public peers. They add that competition-driven innovation is lacking as the three largest firms control nearly the entire market.</p><p>"We aren't saying private prisons are bad," Galinato said. "But states need to be careful with them. If your state has previous and regular issues with corruption, I wouldn't be surprised to see laws being more skewed to give longer sentences, for example. If the goal is to reduce the number of incarcerated individuals, increasing the number of private prisons may not be the way to go."</p>
What exactly does "questions are the new answers" mean?
- Traditionally, intelligence has been viewed as having all the answers. When it comes to being innovative and forward-thinking, it turns out that being able to ask the right questions is an equally valuable skill.
- The difference between the right and wrong questions is not simply in the level of difficulty. In this video, geobiologist Hope Jahren, journalist Warren Berger, experimental philosopher Jonathon Keats, and investor Tim Ferriss discuss the power of creativity and the merit in asking naive and even "dumb" questions.
- "Very often the dumb question that is sitting right there that no one seems to be asking is the smartest question you can ask," Ferriss says, adding that "not only is it the smartest, most incisive, but if you want to ask it and you're reasonably smart, I guarantee you there are other people who want to ask it but are just embarrassed to do so."