Economist Robert Gordon recently uploaded an NBER working paper regarding US economic growth that Mark DeWeaver recently passed to me. Gordon makes the case that there are a number of headwinds (six by his count) that will prevent the US from growing more than one percent over the foreseeable future.
While I am bearish in some respects, I do not find any of the headwinds presented convincing. In fact as I explain below, I find most of them simply non-issues and that other unmentioned policies to be much larger culprits in stymieing economic growth.
At the beginning, Gordon notes that this paper is an exercise in what-ifs. Key to his point is, what-if the financial crisis did not occur after 2007 — what is the best-in-case growth trajectory for the US sans the financial correction?
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