The North-South Income Gap

Picture the map of the world as popularized by the cover of the recent report of the Brandt Commission on international development issues. A line is drawn on the map that, following it from west to east, runs along the southern borders and shores of the United States, Europe, the Soviet Union, and Japan. The line then swings down to enclose the continent of Australia along with New Zealand into a tenuous geographic brotherhood with the globe's upper tier. and as defined by this line are of course synonymous with the familiar collective categories that for the last 25 years or so have been known as the and the developing countries. The change in terminology is felicitous. While it does take some effort to think, say, of the Koreas or of Mongolia as South, such mental gymnastics dispense with awkward euphemisms such as referring to the countries of the Sahel as developing. It is also easier to call New Zealand part of the North than, for instance, to call Albania a developed country. At the very least, economy of expression favors the geographic labels. Whatever the labels, the main justification for making such a cavalier distinction between two broad groups of the world's countries is that North and South represent enormous differences in economic wealth and power. I will illustrate the point by reference to some conventional statistics. World gross national product in 1978 (the last year for which detailed estimates are available) was some US$8.5 trillion. The use of national income statistics either for calculating aggregates of this sort or for making international comparisons, of course, does raise serious problems of concept and measurement. Later I will comment on these problems briefly, but for the time being I will take such statistics at their face value or, at least, as rough indicators of orders of magnitude. World population, now past the 4.4 billion mark, was somewhat over 4.2 billion in 1978. In terms of annual per capita income, these figures translate into an overall world average of just over $2,000

Commission · Development economics · Economic growth · Economics · Economy · Geography · Globe · Gross domestic product · Political science · Power (physics) · Economic Growth and Productivity · Law · Russia and Soviet political economy

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