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Assessing the Sustainability of Global Growth

The world economy has enjoyed five years of fast growth. The question of how long economies can grow at fast rates without adjustment is important. Since GDP is an incomplete gauge of economic performance, the answer also depends on understanding the structure of the underlying dynamics driving growth and the extent to which these dynamics are self-correcting or, alternatively, tend to excesses in one sector that are often recognized too late. Both the accelerated pace of global growth and the narrow base of technology and market reforms across countries raise doubts about the sustainability of the current growth path.

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