Using a comparison of Jamaica and Singapore, I recently argued that growth should trump inequality.
In other words, nations with smaller government and less intervention produce better results than nations with bloated governments and lots of meddling.
You see that relationship by comparing Jamaica and Singapore, and you also see it when examining other nations.
This is fresh in my mind since I just spoke at the Kyiv stop on the Free Market Road Show.
I told the audience about the reforms that Ukraine needs to strengthen economic performance, but I probably should have simply read what one expert recently wrote about Ukraine and Poland.
Here’s some of what Allister Heath had to say for London’s City A.M.
In the dreadful communist days, Ukraine and Poland used to be equally poor. The former was part of the Soviet Union, and Poland was one of the USSR’s satellite nations, belonging to the Warsaw pact. In 1990, both countries had roughly the same GDP per capita – their economies were eerily similar. A quarter of a century later, everything has changed… It’s a tale of two economic models, and a central reason why Russia – a waning world power desperate to cling on to its historic zone of influence – has felt able to bully Ukraine in such a shocking way. …The big difference is that Poland has pursued free-market policies, reducing the size of its state, introducing a strict rule of law and respect for property rights, privatising in a sensible way, avoiding the kleptocracy and corruption that has plagued regimes in Kiev, and embracing as much as possible Western capitalism.
Allister cites World Bank data to state that “Poland’s GDP per capita is now 3.3 times greater than Ukraine’s.”