The term 'Growth rate of income ' refers to the pace at which income, population, or any other variable changes over time : 
$$
growth rate= change In Income /Original Level Of Income
$$

Growth rate of income 

When comparing GDP per capita levels and growth rates across countries and different time periods, two types of scales are used. One scale facilitates the comparison of GDP levels, while the other, a ratio scale, allows for comparing growth rates. On a ratio scale, a series with a constant growth rate appears as a straight line, and a steeper line indicates a faster growth rate. For instance, if GDP per capita doubles or quadruples over 100 years, the ratio scale will show different slopes, reflecting the difference in growth rates.

Comparing GDP Levels and Growth Rates:

Capitalism, causation, and history's hockey stick are concepts that intertwine to examine the relationship between economic systems and the exponential growth in living standards and technology. Capitalism, as an economic system, encourages competition, innovation, and specialization, which have been linked to the upward surge of the so-called "hockey stick" in historical development. This term represents the sudden increase in wealth and technological advancements over the past few centuries, transforming societies and the world as we know it. While it's essential to approach the idea of causation with skepticism, one cannot deny that capitalism has played a significant role in shaping the trajectory of human progress and the exponential growth depicted by the hockey stick of history.

Capitalism, causation and history’s hockey stick

Figure 1.1a uses GDP per capita, a measure of average annual income, to compare living standards across countries. GDP (gross domestic product) represents the total value of goods and services produced in a given period. The graph shows that people in Britain are, on average, six times wealthier than those in India, with Japanese people having similar wealth to the British. Americans are wealthier than the Japanese, and Norwegians are the wealthiest among these groups. The graph is based on the work of Angus Maddison, who collected data to compare living standards over more than 1,000 years. His work continues through [the Maddison Project](https://www.rug.nl/ggdc/). A millennium ago, income disparities between regions were relatively small, but today, significant income inequalities exist worldwide.

History’s hockey stick: Gross domestic product per capita in five countries (1000–2018).

Refers to the sudden and rapid growth in income levels, primarily linked to the emergence and spread of capitalism. Before the Industrial Revolution, income levels remained relatively stagnant, but with the advent of capitalism and new technologies, economies experienced unprecedented expansion. Capitalism facilitated innovation, wealth creation, and improved living standards, giving rise to the hockey stick-shaped growth trajectory. However, it also led to issues like wealth concentration, inequality, and environmental degradation, sparking debates about capitalism's role in promoting or hindering social progress.

San Jose State University

Stanford University

GDP per capita is a measure of a country's economic output per person. It is calculated by dividing the total GDP of a country by its population. This measure is often used to compare living standards across countries, as it takes into account both the size of a country's economy and the size of its population. A high GDP per capita generally indicates a higher standard of living, as individuals have access to more goods and services on average. However, it is important to note that GDP per capita is not a perfect measure of a country's living standards, as it does not account for factors such as income inequality or differences in the cost of living.

GDP Per Capita

To cite The Economy, we suggest combining the referencing style for an ebook and treating each unit as a chapter, for instance (using Harvard style): Bowles, S., Carlin, W. and Stevens, M. (2017). ‘Property and power: Mutual gains and conflicts’. Unit 5 in The CORE team, The Economy. Available at: https://www.core-econ.org. [Accessed on (date)].

https://www.core-econ.org/the-economy/v1/book/text/0-3-contents.html

CORE Econ - The Economy 1.0

History’s hockey stick: Growth in income

Figure 1.2 depicts the distribution of income both between and within countries. Countries are organized based on GDP per capita, with the least affluent country (Liberia) on the left side of the diagram and the most affluent country (Singapore) on the right. The population size of each country is represented by the width of its bars.

Each country is divided into ten bars, each representing a decile of income. The height of each bar indicates the average income of 10% of the population, starting with the lowest-earning 10% at the front of the diagram and progressing to the highest-earning 10% at the back. The income is measured in 2005 US dollars. It's important to clarify that "the richest 10% of people" refers to the wealthiest 10% of the entire population, not just income earners. It is assumed that each member of a household, including children, receives an equal portion of the household's income.

Visualizing Income Distribution: A Comparison of Countries by GDP Per Capita and Income Deciles

- Comparing pre-1800 data points in Britain, Japan, Italy, China, and India
- Comparing Britain, Japan, Italy, China, and India
- Britain
- Japan
- India and China
- China and Japan

Examples Using GDP to Calculate National Economic Growth 1000-2000CE

- South Korea
- Botswana and Nigeria
- USSR
- Post-Soviet States

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