Economic
Productivity

As demonstrated in the article “Economic Stages of Development”, the most basic stages of development provide sustaining only for the nuclear family and not for a larger social unit. The first three stages are self-sufficiency-based in that those living had no means to produce or keep more than enough for their immediate needs. Even when the Agricultural Revolution gave workers the means to produce more than enough to sustain themselves, life was still basic with little more than food, clothing and shelter. Leisure time and recreation were mere respites from working. Each person must work to endure, productivity was essential for survival. The hunter-gatherer had a life expectancy of 28-32 years. By the more recent 1800s, worldwide life expectancy was all of 40 years and not until the 1960s did life expectancy reached 70 in the more developed civilizations. Infant mortality rates indicated that half of all children died before adulthood and it wasn’t until 1800 that the child mortality rate for those under 5 years first registered at 462 deaths per 1,000 births. As recently as 1,000 AD, the Gross Domestic Product per capita (in 1990 dollars) averaged $425 in Europe, $400 in the Americas, $466 in Asia. It is estimated that GDP in ancient times (up through first agricultural revolution) was $158 per person per year. ¹

The hunter-gatherer who was unsuccessful went hungry and if ineffective for a long enough duration, would expire along with his family unit. Everyone was subject to providing for the family unit except the youngest infants. Life was not easy for anyone.

When the Agricultural Revolution made it possible to produce more basics than one needed to sustain themselves, the size of the economic unit (family) could become the extended family (band) but everyone had to be productive in the care of the family. Child labor in the pre-industrial age was simply part of the requirement for survival. As soon as subsistence was no longer survival, productivity became an economic driver. By the time of the Industrial Age, the economic formula was Productivity equals Output divided by Input which soon translated into the more produced with the least input the better.

The modern standard of measure of Productivity is GDP (Gross Domestic Product) which is used to gauge all levels of output. It is expected that the end result (Product) will be greater than the input of goods and services used to create the product. During the Age of Exploration and then the Colonial Age, the quest was for free resources to be used with low-cost labor to create product that was valued above the cost of the input. Much of the early mercantile system was rooted in free resources with lowest-cost labor to resulting in the highest return to the merchant.

Ideally, as productivity increases the laborers will have more income and will be able to afford more goods while at the same time more efficient production will result in lower cost and selling price of the goods. There also is an expectation that increased profits to the merchant will promote research and development of new means of production and more and better products.

There have been periods of growth when productivity produced the desired benefits at all levels but if any level of production is out of balance, it is detrimental to the economics of growth. If the resources are unavailable or not economically feasible to obtain, if the labor isn’t available or willing to be as productive as the market requires, if the ownership of the product doesn’t invest suitable volumes of capital into the process to promote continued production or if the market is unavailable due to distribution or economic conditions, the system lags and participants are discouraged in being part of the system. If the merchant takes too much out of the system or the laborer does not produce more than is consumed or if the resources are unavailable within the value of the finished goods, the system doesn’t work for long.

Once a society has moved away from subsistence, where each person is responsible for providing enough to meet their own needs, several issues may arise:

1. Over-producers see themselves as entitled to greater importance, i.e., more goods, higher position, favored status, elite-ism.
2. Core producers come to support the economy but without equity of input to the equality of distribution.
3. Marginally-productive ones seek more than their production warrants.
4. Non-producers see the abundance of others as something they want, for which they have not produced and seek the means to satisfy wants without production.
5. Distribution becomes dis-related to production.
6. Merchants seek to maximize the difference between costs, production and profit.
7. Government endeavors to create equity of distribution without equality of production.
8. Society creates classes of entitlement relative to inverted productivity.
9. Development of marketable skills becomes dis-related to economic needs.

Productivity has seldom been followed by equity or even equality as one region or civilization may well make advances ahead of others and then use that position as an advantage over others.

GWP is the estimate of Gross World Product and growth is not a constant. “In 1998, economic historian J. Bradford DeLong estimated the total GWP in 1990 U.S. dollars” ² … and made the following historical estimates. We have added the world population estimates ³ and extrapolated the per capita productivity PPP from dividing the GWP by the World Population. This is not a standard recognized calculation by economists but is a relative reference.

BUT. There is a but – Productivity as measured by monetary means is not a solid indicator of the productivity of a nation’s residents. In the World Population Review, March 31, 2025, the list of Top 10 Most Productive Countries (using GDP per Capita) are:

1. Luxembourg $134,754
2. Singapore $116,487
3. Ireland $106,456
4. Qatar $93,521
5. Bermuda $85,192
6. Norway $79,201
7. Switzerland $77,324
8. Macau $73,802
9. Cayman Islands $72,481
10. United States $69,288

While five of the ten are tax haven countries and one has a very small citizen population and a very large oil exportation business, this is not the entire story. When Productivity per Hour is considered and GDP per Hours worked is calculated, there is another glimpse at real productivity.

The Ten Most Productive Countries with GDP per hours worked and the Hours worked per week are:

1. Ireland $119.10 on a 39.7 hour week
2. Luxembourg $110.80 on 40 hours
3. Denmark $87.70 on 37.2 hours
4. Belgium $86.80 on 38.8 hours
5. Norway $85.60 on 38 hours
6. Switzerland $81.40 on 40.5 hours
7. France $79.70 on 38.9 hours
8. United States $79.60 on 41.5 hours
9. Austria $79.40
10. Sweden $79.10

Our last statistic is unemployment rates among the world population. Using metrics from the U.S. CIA World Factbook⁵ but also comparable to Wikipedia⁶ it becomes obvious that two statistics are glaring:

World’s lowest unemployment rate is Qatar at 0.13% and that most low income countries also have low unemployment rates. Countries with subsistence requirements for survival tend to have higher rates of employment even though the income is drastically lower.

Last, as a point of interest, the List of Countries by Social Welfare Spending⁷ as compiled by the OECD (Organisation for Economic Co-operation and Development) lists per capita spending ranking many of the most productive countries:

1. Luxembourg $19,428
2. Norway $14,711
3. Denmark $12,895
4. Austria $11,926
5. Belgium $11,917
6. France $11,796
7. Sweden $11,664
8. Finland $11,515
9. Germany $10,599
10. United States $9,734