Fully Grown: Why a Stagnant Economy Is a Sign of Success
Dietrich Vollrath
(Author)
Description
Vollrath challenges our long-held assumption that growth is the best indicator of an economy's health. Most economists would agree that a thriving economy is synonymous with GDP growth. The more we produce and consume, the higher our living standard and the more resources available to the public. This means that our current era, in which growth has slowed substantially from its postwar highs, has raised alarm bells. But should it? Is growth actually the best way to measure economic success--and does our slowdown indicate economic problems? The counterintuitive answer Dietrich Vollrath offers is: No. Looking at the same facts as other economists, he offers a radically different interpretation. Rather than a sign of economic failure, he argues, our current slowdown is, in fact, a sign of our widespread economic success. Our powerful economy has already supplied so much of the necessary stuff of modern life, brought us so much comfort, security, and luxury, that we have turned to new forms of production and consumption that increase our well-being but do not contribute to growth in GDP. In Fully Grown, Vollrath offers a powerful case to support that argument. He explores a number of important trends in the US economy: including a decrease in the number of workers relative to the population, a shift from a goods-driven economy to a services-driven one, and a decline in geographic mobility. In each case, he shows how their economic effects could be read as a sign of success, even though they each act as a brake of GDP growth. He also reveals what growth measurement can and cannot tell us--which factors are rightly correlated with economic success, which tell us nothing about significant changes in the economy, and which fall into a conspicuously gray area. Sure to be controversial, Fully Grown will reset the terms of economic debate and help us think anew about what a successful economy looks like.Product Details
Price
$33.00
Publisher
University of Chicago Press
Publish Date
January 13, 2020
Pages
296
Dimensions
6.3 X 9.1 X 1.2 inches | 1.2 pounds
Language
English
Type
Hardcover
EAN/UPC
9780226666006
BISAC Categories:
Earn by promoting books
Earn money by sharing your favorite books through our Affiliate program.
Become an affiliate
About the Author
Dietrich Vollrath is professor of economics at the University of Houston. He is coauthor of Introduction to Economic Growth, now in its third edition, and writes the Growth Economics Blog.
Reviews
"Fully Grown makes a coherent and compelling argument that American productivity growth has only mildly faltered."-- "Wall Street Journal"
"For Dietrich Vollrath of the University of Houston, low growth is reason for cheer. In a new book he argues that America's growth has slowed because so much in the economy has gone so well. . . . His triumph is in showing the degree to which these [GDP numbers] make economic growth an unreliable measure of success. Attempting to capture progress in a single number is a fool's errand."
-- "Economist"
"Taken together, slower growth in the labor force and the shift to services can explain almost all the recent slowdown, according to Vollrath. He's unimpressed by many other explanations that have been offered, such as sluggish rates of capital investment, rising trade pressures, soaring inequality, shrinking technological possibilities, or an increase in monopoly power. In his account, it all flows from the choices we've made: 'Slow growth, it turns out, is the optimal response to massive economic success.'"-- "New Yorker"
"Given the likelihood of recession, some desperate West Wing scribe might want to sneak a few thoughts from Vollrath's Fully Grown: Why a Stagnant Economy Is a Sign of Success into the State of the Union speech. Challenging the automatic equation between economic health and a growing gross domestic product, the author argues that capitalism 'has already supplied so much of the necessary stuff of modern life--brought us so much comfort, security and luxury--that we have turned to new forms of production and consumption that increase our well-being but do not contribute to growth in GDP.'"-- "Inside HIgher Ed"
"For the past decade, Robert Gordon has written about the rise and fall of American growth, praising the first in our past that was and lamenting the second in our present that is. Now comes Vollrath with a lively, accurate, and essential corrective to Gordon's pessimism: growth is slow today, he demonstrates, not because our economy is failing but because our economy has succeeded."--Brad DeLong, University of California, Berkeley "Inside HIgher Ed"
"Vollrath offers a provocative new explanation of the slowdown in economic growth experienced by the US economy during the past two decades: we are a victim of our own success. Rising leisure, declining fertility, and the shift out of manufacturing into services explain the bulk of the slowdown in aggregate income growth. Each is a feature of a mature, developed economy, and in that sense, the slowdown may be a symbol of success rather than a sign of failure. Brilliantly supported by the latest research and engagingly presented, Fully Grown provides a startling, novel assessment of economic growth in the 21st century."
--Brad DeLong, University of California, Berkeley "Chad Jones, Stanford University"
"Anybody who has followed Vollrath's blog will have been eagerly waiting for this book. Fully Grown is essential reading for anybody interested in the future of the economy. It investigates why the United States and other advanced economies are growing more slowly than in the past. Contrary to conventional wisdom, it argues this slowdown is due to success, not failure. All the leading economies have aging populations, thanks to past gains in health, and are largely service-based, as material goods account for a shrinking share of spending. These two characteristics alone mean the economy will not expand as rapidly in the 21st century. There are plenty of other problems to tackle, from unequal opportunities to excessive market power; but, Vollrath argues convincingly, the growth rate is the wrong way to assess how well the economy is doing." --Diane Coyle, Bennett Professor of Public Policy, University of Cambridge "Chad Jones, Stanford University"
"This book completes, for me, a series of books that have come out in the last couple of years that help to explain the current state of the US economy and why we can be optimistic about a lot of what is going on."
--Diane Coyle, Bennett Professor of Public Policy, University of Cambridge "Seeking Alpha"
"Typically, lower economic growth is deplored because it squeezes private living standards and government programs. But in a fascinating new book, economist Dietrich Vollrath of the University of Houston challenges the conventional wisdom."--Robert Samuelson "Washington Post"
"An impressive survey of the economics literature on US productivity. For those interested in the subject, it is a must-read."
-- "Financial Times"
"For Dietrich Vollrath of the University of Houston, low growth is reason for cheer. In a new book he argues that America's growth has slowed because so much in the economy has gone so well. . . . His triumph is in showing the degree to which these [GDP numbers] make economic growth an unreliable measure of success. Attempting to capture progress in a single number is a fool's errand."
-- "Economist"
"Taken together, slower growth in the labor force and the shift to services can explain almost all the recent slowdown, according to Vollrath. He's unimpressed by many other explanations that have been offered, such as sluggish rates of capital investment, rising trade pressures, soaring inequality, shrinking technological possibilities, or an increase in monopoly power. In his account, it all flows from the choices we've made: 'Slow growth, it turns out, is the optimal response to massive economic success.'"-- "New Yorker"
"Given the likelihood of recession, some desperate West Wing scribe might want to sneak a few thoughts from Vollrath's Fully Grown: Why a Stagnant Economy Is a Sign of Success into the State of the Union speech. Challenging the automatic equation between economic health and a growing gross domestic product, the author argues that capitalism 'has already supplied so much of the necessary stuff of modern life--brought us so much comfort, security and luxury--that we have turned to new forms of production and consumption that increase our well-being but do not contribute to growth in GDP.'"-- "Inside HIgher Ed"
"For the past decade, Robert Gordon has written about the rise and fall of American growth, praising the first in our past that was and lamenting the second in our present that is. Now comes Vollrath with a lively, accurate, and essential corrective to Gordon's pessimism: growth is slow today, he demonstrates, not because our economy is failing but because our economy has succeeded."--Brad DeLong, University of California, Berkeley "Inside HIgher Ed"
"Vollrath offers a provocative new explanation of the slowdown in economic growth experienced by the US economy during the past two decades: we are a victim of our own success. Rising leisure, declining fertility, and the shift out of manufacturing into services explain the bulk of the slowdown in aggregate income growth. Each is a feature of a mature, developed economy, and in that sense, the slowdown may be a symbol of success rather than a sign of failure. Brilliantly supported by the latest research and engagingly presented, Fully Grown provides a startling, novel assessment of economic growth in the 21st century."
--Brad DeLong, University of California, Berkeley "Chad Jones, Stanford University"
"Anybody who has followed Vollrath's blog will have been eagerly waiting for this book. Fully Grown is essential reading for anybody interested in the future of the economy. It investigates why the United States and other advanced economies are growing more slowly than in the past. Contrary to conventional wisdom, it argues this slowdown is due to success, not failure. All the leading economies have aging populations, thanks to past gains in health, and are largely service-based, as material goods account for a shrinking share of spending. These two characteristics alone mean the economy will not expand as rapidly in the 21st century. There are plenty of other problems to tackle, from unequal opportunities to excessive market power; but, Vollrath argues convincingly, the growth rate is the wrong way to assess how well the economy is doing." --Diane Coyle, Bennett Professor of Public Policy, University of Cambridge "Chad Jones, Stanford University"
"This book completes, for me, a series of books that have come out in the last couple of years that help to explain the current state of the US economy and why we can be optimistic about a lot of what is going on."
--Diane Coyle, Bennett Professor of Public Policy, University of Cambridge "Seeking Alpha"
"Typically, lower economic growth is deplored because it squeezes private living standards and government programs. But in a fascinating new book, economist Dietrich Vollrath of the University of Houston challenges the conventional wisdom."--Robert Samuelson "Washington Post"
"An impressive survey of the economics literature on US productivity. For those interested in the subject, it is a must-read."
-- "Financial Times"
