Chen, Yueyun (Bill) See all items with this value

Ding, Jing See all items with this value

2026

6

1

61-89

2583-1526 See all items with this value

This study provides a comprehensive analysis of the United States of America (USA)’s economic development since 1971 using both the expenditure and the value-added approaches for GDP measurement. The regression results show that for the expenditure model, personal consumption and total investment made the most contribution to American economic growth; and for the value-added model, labor rate and service industry productivity were the most important factors for American economic prosperity. In contrast, other variables, including the productivities in the other two industries, urbanization rate and labor shares in three sectors did not have any significant effect. Next, our paper focuses on the past and future changes in all economic factors, including economic structure, labor rate, productivity, trade, investment, consumption, and urbanization, to explore how these changes have affected and will impact the US economy. We then compare China with the USA and discuss what China can learn from American experience. There are many similarities and differences between these two countries. The major difference is that the USA achieved industrialization, modernization, and urbanization when it was the largest economy in the world in the 1950s, but China has still been going through these processes and advancements even after it became the second largest economy in 2010. Therefore, China still has a large potential for continuous and sustainable growth. One of the most important lessons from the US experience is that the economic structure change from industry to service-focused may hurt the whole economy.