ABSTRACT
An economy’s growth rate determines its standard of living on an income per head basis. Around the world, living standards differ markedly. For instance, average household income in many advanced economies is at least ten times higher than in many developing economies. Meanwhile, economies in East Asia, including China, Japan, Singapore and South Korea, have experienced rates of growth unsurpassed in human history that have lifted hundreds of millions of people out of poverty over the past half century. This chapter focuses on the key factors influencing trends in GDP growth, around which an economy’s business cycle fluctuates.
