How to Understand GDP

What is Gross Domestic Product (GDP)? The definition is rather straightforward: GDP is the market value of all finished goods and services, produced within a country in a year. But that’s not very useful in trying to understand the concept. Continue Reading...

The hockey stick of human prosperity

Since the era of Adam Smith economists have been asking, “What creates wealth?” One key answer is specialization and trade. On a timeline of human history, the recent rise in standards of living resembles a hockey stick — flatlining for all of human history and then skyrocketing in just the last few centuries. Continue Reading...

The Puzzle of Economic Growth

Why are some countries rich and others poor? The answer to that question is complex – and hotly debated. But economist Alex Tabarrok outlines several key ingredients to consistent economic growth -productivity, incentives, institutions – and explains how they are combined with factors such as a country’s history, ideas, culture, geography, and even a little luck. Continue Reading...