India 2022: Getting bigger but not richer

The link between the size of the economy and prosperity is tenuous

Two interesting things have happened almost simultaneously in the past year. Bangladesh’s per capita income overtook that of India and, more recently, India has overtaken the United Kingdom to become the fifth largest economy in the world.

This juxtaposition underscores two things. First, the link between size and prosperity is tenuous, even if we ignore economic inequality. Bangladesh as a country is much poorer than India, but its citizens are richer. Because of economic size, India is a member of the G20. But its citizens are the poorest in the G20. The citizens of Indonesia, the next poorest, have a per