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This is not a great comparison: net worth vs market value of goods over time. E.g. what if GDP was measured in decades instead of years?

by depr 9y ago

adventured 9y ago
It's a perfectly good comparison in fact. Let me show you how that works. Did you know, the Stratolaunch has a wingspan wider than the length of a US football field? The equivalent reply would be: geez, that's a terrible comparison, because the Stratolaunch is not a large plot of ground, they're entirely different things! GDP is obviously not inherently measured in years. GDP has no set measurement period of time. GDP can be measured in quarters (and frequently is), years, decades, etc. It's most commonly measured in a one year span of time though, and it's likely safe to believe that's exactly what the parent was referring to. One should give people the benefit of the doubt on their intellect and knowledge, imo.
- dwohnitmok 9y ago
  Eh I think the intuition the parent is trying to get at is that GDP is really in some sense a measure of flow, that is it is a measure of quickly money is exchanging hands weighted by how much money is being exchanged. Hence it feels more akin to comparing something like joules to watts rather than comparing the same dimension of two non-like things. Put another way, yes Jeff Bezos could more than double the GDP of the country in question if he donated his entire net worth as someone else's income. But so could someone with a trivial sum of money (say a single U.S. dollar) by creating a series of dummy transactions with someone else where they constantly exchange the same sum of money back and forth for dummy "services." Yet at some level it seems weird to compare Jeff Bezos with this hypothetical person. That being said, that's just an intuition. GDP is actually calculated as a dollar amount not a rate. As such I think there's still some worthwhile explanatory value in using GDP as a measure against static monetary amounts in the same way that you can say "this swimming pool has the same amount of water as the amount of water that flows over Niagara Falls in a day" (to the best of my knowledge such a large pool does not exist).

This is not a great comparison: net worth vs market value of goods over time. E.g. what if GDP was measured in decades instead of years?

by depr 9y ago

This is not a great comparison: net worth vs market value of goods over time. E.g. what if GDP was measured in decades instead of years?

adventured 9y ago

It's a perfectly good comparison in fact. Let me show you how that works. Did you know, the Stratolaunch has a wingspan wider than the length of a US football field? The equivalent reply would be: geez, that's a terrible comparison, because the Stratolaunch is not a large plot of ground, they're entirely different things! GDP is obviously not inherently measured in years. GDP has no set measurement period of time. GDP can be measured in quarters (and frequently is), years, decades, etc. It's most commonly measured in a one year span of time though, and it's likely safe to believe that's exactly what the parent was referring to. One should give people the benefit of the doubt on their intellect and knowledge, imo.

dwohnitmok 9y ago
Eh I think the intuition the parent is trying to get at is that GDP is really in some sense a measure of flow, that is it is a measure of quickly money is exchanging hands weighted by how much money is being exchanged. Hence it feels more akin to comparing something like joules to watts rather than comparing the same dimension of two non-like things. Put another way, yes Jeff Bezos could more than double the GDP of the country in question if he donated his entire net worth as someone else's income. But so could someone with a trivial sum of money (say a single U.S. dollar) by creating a series of dummy transactions with someone else where they constantly exchange the same sum of money back and forth for dummy "services." Yet at some level it seems weird to compare Jeff Bezos with this hypothetical person. That being said, that's just an intuition. GDP is actually calculated as a dollar amount not a rate. As such I think there's still some worthwhile explanatory value in using GDP as a measure against static monetary amounts in the same way that you can say "this swimming pool has the same amount of water as the amount of water that flows over Niagara Falls in a day" (to the best of my knowledge such a large pool does not exist).