Aren't developing economies better suited for higher %-age growth rates? I'm not saying Greece is developing country in the traditional sense, but would seem that smaller, comparatively less developed economies (compared to say some of the G7 members on the graph). I.e. it takes less in terms of actual growth to move the needle in Greece or Slovakia than it does say in Germany, Britain etc...
Or am I off base here?
You're not. A poor country is essentially one with a deficit of capital goods and skills. In effect, the ideas already exist and merely need to be put together to achieve growth (easier said than done, of course). In an advanced economy, growth has to be produced from new ideas. Things need to be invented, processes combined, thoughts thought, in order to produce more than was possible to produce before.
Now, in the case of the Greeks, there's simply a lot of spare capacity off line thanks to bad political environment and devastating monetary policy. Putting what already exists back on line is always easier than creating something new
