When GDP is measured by exchange rates, the U.S. economy is still larger than China’s. By the other major measure of GDP—purchasing power parity—China is already the largest economy in the world. By that measure, it overtook the United States in 2014. (Just to note, Germany’s economy overtook Britain’s in 1910, four years before the outbreak of the First World War.) But one reality check is in order for China’s future growth—demographics, the consequence of the one-child policy and social changes. “No country has ever gone gray at a faster rate,” demographer Nicholas Eberstadt has observed.
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