A Study of the Long-Term Structural Trends in Global Economic Growth: An Empirical Analysis Based on Purchasing Power Parity Decomposition from 1970 to 2023

Abstract

Abstract: The global economic landscape has undergone profound structural changes over the past 50 years, with globalization and digitization reshaping the transnational price system, making it difficult to accurately measure the real output capacity of countries (region) using traditional nominal Gross Domestic Product (GDP) and constant price GDP. To address this issue, based on purchasing power parity (PPP) panel data from 183 economies worldwide, this paper constructs a double deflation analysis framework for converting nominal GDP to real GDP. The global real GDP growth is decomposed into real growth effects, inflation effects, and PPP effects, and the global, regional, and country (region) economic real growth structures are characterized under a unified price system. Research has found that the long-term growth of the global economy is mainly driven by the expansion of real output, but shows a clear phased downward trend. The inflation effect within economics is consistent with the global inflation effect cycle. The PPP effect reflects significant regional differences in cross-country (region) price convergence and divergence. At the regional level, the global economy has formed a high growth pole composed of the Asia Pacific and South Asia regions, a stable pole composed of North America and Europe and Central Asia regions, and a high volatility pole tripartite pattern composed of Latin America, the Middle East and North Africa, and the Sahara region. At the economic level, China and India represent two different catch-up models, while the United States exhibits the price anchoring characteristics of developed economies. The real economic scale adjusted by PPP shows that China’s economic growth model is shifting from quantity expansion to quality accumulation. Based on this, establishing an internationally comparable measurement system based on PPP is an important direction for China to comprehensively enhance its national governance capacity and build an independent statistical knowledge system. During the 15th Five Year Plan period, it is necessary to accelerate the construction of a“PPP - Growth - Statustics”measurement system oriented towards modernization goals.

Key words: global economic growth, real economic size, purchasing power parity, statustics measurement, autonomous knowledge system

CLC Number:

F061.2

Wang Ya-fei, Wu Si-yang, Xu Li-xiao. A Study of the Long-Term Structural Trends in Global Economic Growth: An Empirical Analysis Based on Purchasing Power Parity Decomposition from 1970 to 2023[J]. Contemporary Finance & Economics, 2026, 0(4): 3-17.

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