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We need YOU to triple the economy!

Making a case that opportunities exist for all to make a living and to help improve the world.

Among the many systematic human biases which have been documented, the bias scope neglect is an important one which for me continues to be difficult to overcome. A commonly discussed way to overcome biases, is to not trust your gut feeling, but to just "shut up and multiply" and to make a thorough analysis of the topic you're assessing. So let's apply  this way of thinking to better understand a fun and important topic which I frequently work with and where I see a lot of misconceptions: economic growth!

To start off, the scale of the economy is mind boggling. The scale of the future economy even more so. Although the future is hard to predict, research indicates that the global economy is expected to nearly triple  in size by 2050.[1] Triple! So what does this actually mean? As the total worth of the goods and services which are exchanged increases, total welfare will go up enormously!

However, this is not the whole story of course. The exchange of goods and services are just one proxy for welfare, but it leaves out many other elements which people may care about, from the state of the environment, to inequality, to freedom of speech, just to name a few. However, GDP is also one of the most decentralized  measures of welfare which we have. It is not only determined by one organization's moral framework, but it is directly measured by people's willingness to pay for goods and services all around the world. And those goods and services may include  those goods and services which are aimed at tackling environmental issues, tackling inequality and increasing freedom speech!

Fortunately, the way in which the economy will grow is not set in stone. It depends on your choices. Whether you make art, join a non-profit or become a scientist, the knowledge you create and the interactions you have will have far reaching consequences rippling through the world.

By some measure, the Gross World Product was 77,868 billion dollars[2] in 2014 . By 2050, it will be around 230,000 billion  dollars.[3] We can calculate the cumulative Gross World Product in this period by using the following formula:

\( \sum_{n=0}^{k}ar^k=a(1-r^{n+1})/({1-r}) \)

Whereby:

Plugging in these numbers, we get a grand total of 5.1 quadrillion dollars! So which role will you play in this story? Although there are huge income differences between countries,[4] let's assume you need at least 10,000 dollars per year to live comfortably. Over a 50 year lifespan, that means you'll need to earn 500,000 dollars. Consequently, you (only) need to capture 0.00000001% of the value that will be created in the world! And if you're above average, which an above average amount of people think they are, then being able to earn this 0.00000001% of the accumulated Global World Product is surely something  which you should believe to be within your capacity.

Of course, there are regions where GDP will not grow, where political turmoil will take its toll and where toxic dynamics make it hard to achieve a basic level of welfare. However essentially, in most places in the world, opportunity is awaiting.

There are a number of sometimes counterintuitive implications which follow from this calculation:

We need you

Everyone plays a tiny part, but that's all which is  needed to achieve massive amounts of welfare in aggregate, taking a little bit of everyone's moral framework into account. Go forth and produce! And you will play your part in tripling the size of the economy.


[1] Hawksworth, J. and Chan, D (2015). The World in 2050 Will the shift in global economic power continue? Retrieved from: https://www.pwc.com/gx/en/issues/the-economy/assets/world-in-2050-february-2015.pdf

[2] https://en.wikipedia.org/wiki/Gross_world_product

[3] Idem, Hawksworth, J. and Chan, D (2015), taking a 3% annual GWP growth into account.

[4] https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita