The worldwide adoption of competition and capitalistic principles has unlocked tremendous prosperity growth. At the core of this prosperity movement are the unique advantages created by urbanizing the world’s population.

Urban populations are more productive, more innovative and more efficient than their rural peers.

This vast urbanization trend accelerates economic activity and presents enormous investment opportunities for us to profit from.

To put this in perspective, today the world population equals roughly 7 billion, and about 50 percent of those individuals live in urban areas. By 2050, the world population will eclipse 9 billion, with over 6 billion living in urban areas. Therefore, over the next 40 years or so, the world’s urban population will nearly double.

This is a big deal. There is a highly positive correlation between a country’s urbanization percentage and its per capita income level.

For instance in the U.S. we are roughly 80 percent urbanized, and our per capita GDP approximates $40,000. The countries urbanizing the most rapidly – China and India – stand presently at 50 percent and 30 percent, respectively.

As they move up the urbanization scale, they will move up the income scale as well. It took the U.S. 53 years to double GDP per capita from $1,300 to $2,600. It took Germany 65 years. It has taken India 16 years and China only 12. But it’s not just the low end achieving rapid prosperity gains, it’s the high end as well.

China now has more millionaires than Japan, the UK and Germany, second only to the U.S. The growth in billionaires in China is astounding. Between 2001 and 2010, the U.S. created 131 billionaires. China created 279 and started with only one.

Clearly, as these societies grow more affluent, their consumption appetites grow as well. According to the OECD, Asian middle class spending today accounts for 23 percent of global consumption.

In 10 years, Asia will account for 42 percent of global middle class spending, and ten years after that, Asia will account for 59 percent of global middle class spending. To clarify the degree of this consumption wave, according to the Boston Consulting Group, by 2020 China and India combined will consume 35 percent of the meat and 60 percent of the vegetables produced on the planet.

The growth in income and consumption not only powers the global economy, but also provides huge opportunities for local entrepreneurs.

Contrary to popular U.S. opinion that we are the only entrepreneurs on the globe, the amount of early stage entrepreneurial activity in the developing world now exceeds that of the U.S. In 2009 the U.S. initiated 456,000 patent applications, China and South Korea together initiated 478,000. Germany initiated 60,000.

At Waddell & Associates, we believe that the urbanization of the global population provides the greatest investment opportunity of our generation. Those investors who eschew emerging and frontier market investments out of fear of the unknown greatly limit their potential returns.

Thankfully, capitalism now canvases the globe … so should your portfolio.

David Waddell, who is regularly featured in the Wall Street Journal, USA Today and Forbes, as well as on Fox Business News and CNBC, is president and CEO of Memphis-based Waddell & Associates.