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China has one of the fastest growing economies in the world with growth rates at around 8% estimated to continue through 2005 “Some have predicted that by the year 2020, China's economic output will be close to half that of the U.S.”. It has also been said that China will overtake the United States at some point and be the world leader in economic output.

According to the Solow growth model dealing with fact 3 states, that growth rates are not constant through time and poorer areas grow faster. Another key aspect to the growth model is fact 4 which states, that it is possible to overtake another country in per capita income but very uncommon there have only been a few examples of this actually happening (see Dr. Tufte's ECON 3020 notes). China’s growth rate, while high, just shows its placement along the growth curve in the Solow model. To expect rates as high as they are now to continue on into the distant future cannot be verified or expected. As China’s growth pertains to fact 4 which shows us that the overtaking of the U.S. by China in per capita income is also very unlikely not just according to the Solow model but also with regards to the institutions that they have in place within their country. China does however posses the ability to overtake the U.S. economy in shear size due to the magnitude of its population and its access to resources.

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Copyright, Chris Burt, 2003.