Unified Growth Theory Contradicted by the Economic Growth in Latin America

📝 Abstract

Historical economic growth in Latin America is analysed using the data of Maddison. Unified Growth Theory is found to be contradicted by these data in the same way as it is contradicted by the economic growth in Africa, Asia, former USSR, Western Europe, Eastern Europe and by the world economic growth. Paradoxically, Unified Growth Theory is repeatedly and consistently contradicted by the same data, which were used, but never properly analysed, during the formulation of this theory. Unified Growth Theory does not explain the mechanism of the economic growth because it explains features contradicted by data. This theory is based fundamentally on the unfortunate lack of understanding of the properties of hyperbolic distribution and on the unscientific analysis of data. There was no transition from stagnation to growth at the end of the alleged Malthusian regime because the economic growth was hyperbolic. There was no escape from Malthusian trap because there was no trap. There was no takeoff. On the contrary, at the time of the alleged takeoff economic growth started to be diverted to a slower trajectory. Unified Growth Theory is dissociated from the reality. This theory needs to be revised or replaced. In its present form, it is a collection of irrelevant stories based on impressions and on the unscientific use of data.

💡 Analysis

Historical economic growth in Latin America is analysed using the data of Maddison. Unified Growth Theory is found to be contradicted by these data in the same way as it is contradicted by the economic growth in Africa, Asia, former USSR, Western Europe, Eastern Europe and by the world economic growth. Paradoxically, Unified Growth Theory is repeatedly and consistently contradicted by the same data, which were used, but never properly analysed, during the formulation of this theory. Unified Growth Theory does not explain the mechanism of the economic growth because it explains features contradicted by data. This theory is based fundamentally on the unfortunate lack of understanding of the properties of hyperbolic distribution and on the unscientific analysis of data. There was no transition from stagnation to growth at the end of the alleged Malthusian regime because the economic growth was hyperbolic. There was no escape from Malthusian trap because there was no trap. There was no takeoff. On the contrary, at the time of the alleged takeoff economic growth started to be diverted to a slower trajectory. Unified Growth Theory is dissociated from the reality. This theory needs to be revised or replaced. In its present form, it is a collection of irrelevant stories based on impressions and on the unscientific use of data.

📄 Content

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Unified Growth Theory Contradicted by the Economic Growth in Latin America
Ron W Nielsen1 Environmental Futures Research Institute, Gold Coast Campus, Griffith University, Qld, 4222, Australia January, 2016 Historical economic growth in Latin America is analysed using the data of Maddison. Unified Growth Theory is found to be contradicted by these data in the same way as it is contradicted by the economic growth in Africa, Asia, former USSR, Western Europe, Eastern Europe and by the world economic growth. Paradoxically, Unified Growth Theory is repeatedly and consistently contradicted by the same data, which were used, but never properly analysed, during the formulation of this theory. Unified Growth Theory does not explain the mechanism of the economic growth because it explains features contradicted by data. This theory is based fundamentally on the unfortunate lack of understanding of the properties of hyperbolic distribution and on the unscientific analysis of data. There was no transition from stagnation to growth at the end of the alleged Malthusian regime because the economic growth was hyperbolic. There was no escape from Malthusian trap because there was no trap. There was no takeoff. On the contrary, at the time of the alleged takeoff economic growth started to be diverted to a slower trajectory. Unified Growth Theory is dissociated from the reality. This theory needs to be revised or replaced. In its present form, it is a collection of irrelevant stories based on impressions and on the unscientific use of data.

Introduction We have already demonstrated that the Unified Growth Theory (Galor, 2005a; 2011) is contradicted by the economic growth in Africa, Asia, former USSR, Western Europe and Eastern Europe as well as by the world economic growth (Nielsen, 2014, 2015a, 2015b, 2015c, 2015d, 2015e). Now, we shall show that this theory is also contradicted by the economic growth in Latin America. In our analysis we shall use the latest data published by Maddison (2010). Galor used the earlier publication (Maddison, 2001) but any of these publications can be used to show that the Unified Growth Theory is dramatically contradicted by Maddison’s data.
Again we shall show that, paradoxically, Unified Growth Theory is contradicted by the same data, which were used during its development. Such a paradox is hard to find in science, but it is common in discussions of doctrines accepted by faith. Galor appears to have been guided by the accepted doctrines but he also appears to have been experiencing a genuine problem with the analysis of data. His irrelevant explanations of the mechanism of economic growth

1AKA Jan Nurzynski, r.nielsen@griffith.edu.au; ronwnielsen@gmail.com; http://home.iprimus.com.au/nielsens/ronnielsen.html Suggested citation: Nielsen, R. W. (2016). Unified Growth Theory Contradicted by the Economic Growth in Latin America. http://arxiv.org/ftp/arxiv/papers/1601/1601.01804.pdf 2

are based on a meaningless quotations of isolated numbers, on the unfortunate inexperienced inspection of data and on the habitual use of grossly distorted diagrams (Ashraf, 2009; Galor, 2005a, 2005b, 2007, 2008a, 2008b, 2008c, 2010, 2011, 2012a, 2012b, 2012c; Galor and Moav, 2002; Snowdon & Galor, 2008).
Data are essential in scientific research and they have to be treated with care and respect. Such a treatment of data as repeatedly manifested in the Unified Growth Theory and other associated publications can never lead to reliable conclusions. The ironic feature of this theory is that the data appear to be correct and reliable (not all of them have been checked) but their interpretation is certainly incorrect because it is not based on their scientific and rigorous analysis.
Historical economic growth, represented by the Gross Domestic Product (GDP), is hyperbolic (Nielsen, 2015f). These types of distributions can be misleading even for the most experienced researcher because they create an illusion of being made of two distinctly different components, slow and fast, while in fact they represent a single, monotonically- increasing trajectory. Fortunately, the analysis of these distributions is trivially simple (Nielsen, 2014). The GDP per capita (GDP/cap) distributions are even more deceptive but their analysis is also relatively simple (Nielsen, 2015a). When properly analysed, these distributions also demonstrate that the Unified Growth Theory is contradicted by the data describing economic growth (Nielsen, 2015a).
Latin America is made of less-developed countries (BBC, 2014; Pereira, 2011). According to Galor (2005a, 2008a, 2011, 2012a), economic growth in these countries should have been characterised by two distinctly different regimes of growth: the Malthusian regime of stagnation, which supposed to have ended around 1900 and the post-Malthusian regime, which allegedly commenced ar

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