“United States would be almost as poor as Mexico today if growth was just one-percentage point less every year starting in 1895.
That was just a hypothetical exercise.
There are some very sobering real-world examples. For instance, Nima Sanandaji pointed out this his country of Sweden used to be the world’s 4th-richest nation. But it has slipped in the rankings ever since the welfare state was imposed.
Venezuela is another case study, as Glenn Reynolds noted.
Indeed, according to NationMaster, it was the world’s 4th-richest country, based on per-capita GDP, in 1950.”
…Now? Not so much!