The Wealth of Working Nations | Hoover Institution

January 31, 2024 Hoover Institution | Stanford University Jesús Fernández-Villaverde, the Howard Marks Presidential Professor of Economics at the University of Pennsylvania, discussed “The Wealth of Working Nations,” a paper with Gustavo Ventura (Arizona State University) and Wen Yao (Tsinghua University). PARTICIPANTS Jesús Fernández-Villaverde, John Taylor, Annelise Anderson, Michael Boskin, Doug Branch, Pedro Carvalho, John Cochrane, Chris Dauer, Steve Davis, Sebastian Di Tella, David Fedor, Jared Franz, Bob Hall, Adele Hayutin, Gregory Hess, Laurie Hodrick, Robert Hodrick, Chad Jones, Ken Judd, Matthew Kahn, Pete Klenow, Evan Koenig, David Laidler, Oliver Landmann, John Lipsky, Lee Ohanian, Robert Oster, Radek Paluszynski, Elena Pastorino, Paul Peterson, Alvin Rabushka, Valerie Ramey, Richard Sousa, Tom Stephenson, Jack Tatom, George Tavlas, Yevgeniy Teryoshin, Chris Tonetti, Victor Valcarcel, Gustavo Ventura ISSUES DISCUSSED Jesús Fernández-Villaverde, the Howard Marks Presidential Professor of Economics at the University of Pennsylvania, discussed “The Wealth of Working Nations,” a paper with Gustavo Ventura (Arizona State University) and Wen Yao (Tsinghua University). John Taylor, the Mary and Robert Raymond Professor of Economics at Stanford University and the George P. Shultz Senior Fellow in Economics at the Hoover Institution, was the moderator. PAPER SUMMARY Due to population aging, GDP growth per capita and GDP growth per working-age adult have become quite different among many advanced economies over the last several decades. Countries whose GDP growth per capita performance has been lackluster, like Japan, have done surprisingly well in terms of GDP growth per working-age adult. Indeed, from 1998 to 2019, Japan has grown slightly faster than the U.S. in terms of per working-age adult: an accumulated 31.9% vs. 29.5%. Furthermore, many advanced economies appear to be on parallel balanced growth trajectories in terms of working-age adults despite important differences in levels. Motivated by this observation, we calibrate a standard neoclassical growth model in which the growth of the working-age adult population varies in line with the data for each economy. Despite the underlying demographic differences, the calibrated model tracks output per workingage adult in most economies of our sample. Our results imply that the growth behavior of mature, aging economies is not puzzling from a theoretical perspective. To read the paper, click the following link https://www.sas.upenn.edu/%7Ejesusfv/Wealth_Working_Nations.pdf To read the slides, click the following link https://www.hoover.org/sites/default/files/2024-02/Slides_Hoover.pdf