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> In the West you can only go so far, back there, especially if you have specialized technical knowledge, you have a chance to make an impact at scale that woul

> In the West you can only go so far, back there, especially if you have specialized technical knowledge, you have a chance to make an impact at scale that would never be possible in the West . . . . I am not sure what the U.S. can really do about this without adopting essentially the same repression as in China. I.E. control the flow of personal. [sic] The U.S. economy is nearly 2x larger than China's, and if you're counting the entire "West" (I'm guessing you mean Europe + US?), it's about 4x larger. And that's just looking at GDP; if you consider GDP per capita, the difference is even starker: the U.S. is nearly 7x higher. In terms of immigration, the U.S. has roughly 750x more inbound immigration than China [1], and the EU has similar numbers [2]. I don't think the numbers back up what you're saying here — they contradict it pretty soundly. In fact, the U.S. currently is (IMO stupidly) trying to prevent people from coming at all because it has such a huge volume of inbound immigration. 1: https://en.wikipedia.org/wiki/Immigration_to_China https://en.wikipedia.org/wiki/Immigration_to_China 2: https://en.wikipedia.org/wiki/Immigration_to_Europe https://en.wikipedia.org/wiki/Immigration_to_Europe

PKop 6y ago
>The U.S. economy is nearly 2x larger than China's No, it's not. This is a flaw of using nominal GDP which doesn't take into account currency differentials, and therefore costs of production. China's GDP(PPP) is already bigger https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP) https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)
- reissbaker 6y ago
  GDP(PPP) is useful for observing changes within domestic markets but not global economic power. As per the page you linked: "GDP comparisons using PPP are arguably more useful than those using nominal GDP when assessing a nation's domestic market . . . It is however limited when measuring financial flows between countries." When we are discussing a Taiwanese semiconductor manufacturer stopping shipments to Huawei due to US-led pressure, GDP(PPP) isn't particularly relevant. TSMC doesn't care how much the cost of production in the US is; it produces chips in Taiwan, not America. But it does care about the total dollar value of American economic support, which nominal GDP measures, and GDP(PPP) does not. And for the result of GDP(PPP) on individuals within domestic markets — which was another of the OP's claims, that individuals are likely to obtain more impact and success in China than in the West — you want GDP(PPP) per capita, not overall GDP(PPP). And the numbers still don't back up that claim: China is closer to Iraq than it is to even a fairly economically-challenged Western country like Greece, and nowhere near the US. [1] Hong Kong — when measured separately from the rest of China — is actually very close to US-level GDP(PPP) per capita. But... I think HK's futures in that respect have declined significantly due to the PRC. In fact, Hong Kong used to be slightly higher than the US, and HK has declined on that metric over time while the US has risen. 1: https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)...
  - nine_zeros 6y ago
    PPP gives a great measure of total addressable market size in local currency. US nominal GDP is higher only because US dollar is 7x a Chinese yuan. But there absolutely are more humans in China, with enough yuan to buy more chips than the US. Only that they'll get paid in a lesser currency.
    - reissbaker 6y ago
      > with enough yuan to buy more chips than the US Er, no. By definition a country with higher nominal GDP can afford to import more chips than a country with lower nominal GDP. That's exactly what nominal GDP calculates. This is probably why you're being downvoted into oblivion. It's also why TSMC isn't exporting its chips to Huawei anymore. Also, there's a reason that the yuan is worth 7x less than the USD: it's because the PRC has intentionally devalued its own currency to keep manufacturing costs low and prop up local manufacturing instead of relying on imports, most recently in 2019 in an escalation of the U.S.-China trade war [1]. This helps bolster China's domestic manufacturing capabilities, but bites China in predictable ways when it wants to spend money abroad, e.g. importing chips from Taiwan. 1: https://www.investopedia.com/trading/chinese-devaluation-yuan/ https://www.investopedia.com/trading/chinese-devaluation-yua...
      - PKop 6y ago
        For a while, but nations with twin deficits (trade and fiscal) historically saw their currency lose value, which was a natural correcting mechanism to close inordinately large imbalances, which US has.. massively. Of course what sustains this is $ as global reserve and for most of last few decades need for dollars to buy oil These things are changing. China's size and demand for commodities pushes oil exporters and commodity exporters more and more to accepting yuan. US loss of industry on the margins means $ has less use as reserve. Why stock pile dollars and treasuries if you anticipate large devaluation (deficits) in the future and are purchasing more goods from China? What does US do as a result? Sanction and or invade oil exporters trading for other currencies. Iraq, Iran, Syria, Venezuela, Russia. Nordstream 2 is a big one. Germany and Europe perfectly content to buy cheaper oil from Russia going forward. Much less need for $ though, as a result. Thus, this overvalued $ (based on balance of trade fundamentals) won't perpetuate as it has previously.
- fermienrico 6y ago
  Not familiar with PPP calculations around currency differentials, does it account for Chinese currency manipulation or that would not impact the PPP? Source of currency manipulation claims: https://home.treasury.gov/news/press-releases/sm751 https://home.treasury.gov/news/press-releases/sm751 Yes its US Gov source, but there is a lot of data presented here which I frankly can not grasp: https://home.treasury.gov/system/files/206/2019-05-28-May-2019-FX-Report.pdf https://home.treasury.gov/system/files/206/2019-05-28-May-20...
- dicomdan 6y ago
  Using PPP values instead of real values to compare countries is mathematically incorrect, by definition.
deleted 6y ago
[deleted]
endogui 6y ago
It seems that GDP should only tell part of the story with respect to specialist incomes. A senior engineer in the US will have their salary and contribution diminished by regulatory requirements and business inefficiencies, and will lose a lot of their potential compensation to health insurance, investor compensation, and other rent-seeking. In China, someone with a skill the Party has designated as critical to national goals may have a lot of the bureaucracy and bullshit cleared for them, or may be offered zero-interest loans to develop their business. Or perhaps not... I have no experience here, but GDP is a terrible metric for how much opportunity is available to skilled engineers. Furthermore, compensation for technically skilled individuals is significantly lower in the rest of the world than in the US: visa barriers are definitely holding US tech salaries up. Although China has even stronger restrictions on foreigners, for those who can get into China but not the US it may be a good deal.

PKop 6y ago

>The U.S. economy is nearly 2x larger than China's No, it's not. This is a flaw of using nominal GDP which doesn't take into account currency differentials, and therefore costs of production. China's GDP(PPP) is already bigger https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP) https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

reissbaker 6y ago
GDP(PPP) is useful for observing changes within domestic markets but not global economic power. As per the page you linked: "GDP comparisons using PPP are arguably more useful than those using nominal GDP when assessing a nation's domestic market . . . It is however limited when measuring financial flows between countries." When we are discussing a Taiwanese semiconductor manufacturer stopping shipments to Huawei due to US-led pressure, GDP(PPP) isn't particularly relevant. TSMC doesn't care how much the cost of production in the US is; it produces chips in Taiwan, not America. But it does care about the total dollar value of American economic support, which nominal GDP measures, and GDP(PPP) does not. And for the result of GDP(PPP) on individuals within domestic markets — which was another of the OP's claims, that individuals are likely to obtain more impact and success in China than in the West — you want GDP(PPP) per capita, not overall GDP(PPP). And the numbers still don't back up that claim: China is closer to Iraq than it is to even a fairly economically-challenged Western country like Greece, and nowhere near the US. [1] Hong Kong — when measured separately from the rest of China — is actually very close to US-level GDP(PPP) per capita. But... I think HK's futures in that respect have declined significantly due to the PRC. In fact, Hong Kong used to be slightly higher than the US, and HK has declined on that metric over time while the US has risen. 1: https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)...
- nine_zeros 6y ago
  PPP gives a great measure of total addressable market size in local currency. US nominal GDP is higher only because US dollar is 7x a Chinese yuan. But there absolutely are more humans in China, with enough yuan to buy more chips than the US. Only that they'll get paid in a lesser currency.
  - reissbaker 6y ago
    > with enough yuan to buy more chips than the US Er, no. By definition a country with higher nominal GDP can afford to import more chips than a country with lower nominal GDP. That's exactly what nominal GDP calculates. This is probably why you're being downvoted into oblivion. It's also why TSMC isn't exporting its chips to Huawei anymore. Also, there's a reason that the yuan is worth 7x less than the USD: it's because the PRC has intentionally devalued its own currency to keep manufacturing costs low and prop up local manufacturing instead of relying on imports, most recently in 2019 in an escalation of the U.S.-China trade war [1]. This helps bolster China's domestic manufacturing capabilities, but bites China in predictable ways when it wants to spend money abroad, e.g. importing chips from Taiwan. 1: https://www.investopedia.com/trading/chinese-devaluation-yuan/ https://www.investopedia.com/trading/chinese-devaluation-yua...
    - PKop 6y ago
      For a while, but nations with twin deficits (trade and fiscal) historically saw their currency lose value, which was a natural correcting mechanism to close inordinately large imbalances, which US has.. massively. Of course what sustains this is $ as global reserve and for most of last few decades need for dollars to buy oil These things are changing. China's size and demand for commodities pushes oil exporters and commodity exporters more and more to accepting yuan. US loss of industry on the margins means $ has less use as reserve. Why stock pile dollars and treasuries if you anticipate large devaluation (deficits) in the future and are purchasing more goods from China? What does US do as a result? Sanction and or invade oil exporters trading for other currencies. Iraq, Iran, Syria, Venezuela, Russia. Nordstream 2 is a big one. Germany and Europe perfectly content to buy cheaper oil from Russia going forward. Much less need for $ though, as a result. Thus, this overvalued $ (based on balance of trade fundamentals) won't perpetuate as it has previously.
fermienrico 6y ago
Not familiar with PPP calculations around currency differentials, does it account for Chinese currency manipulation or that would not impact the PPP? Source of currency manipulation claims: https://home.treasury.gov/news/press-releases/sm751 https://home.treasury.gov/news/press-releases/sm751 Yes its US Gov source, but there is a lot of data presented here which I frankly can not grasp: https://home.treasury.gov/system/files/206/2019-05-28-May-2019-FX-Report.pdf https://home.treasury.gov/system/files/206/2019-05-28-May-20...
dicomdan 6y ago
Using PPP values instead of real values to compare countries is mathematically incorrect, by definition.

deleted 6y ago

[deleted]

endogui 6y ago

It seems that GDP should only tell part of the story with respect to specialist incomes. A senior engineer in the US will have their salary and contribution diminished by regulatory requirements and business inefficiencies, and will lose a lot of their potential compensation to health insurance, investor compensation, and other rent-seeking. In China, someone with a skill the Party has designated as critical to national goals may have a lot of the bureaucracy and bullshit cleared for them, or may be offered zero-interest loans to develop their business. Or perhaps not... I have no experience here, but GDP is a terrible metric for how much opportunity is available to skilled engineers. Furthermore, compensation for technically skilled individuals is significantly lower in the rest of the world than in the US: visa barriers are definitely holding US tech salaries up. Although China has even stronger restrictions on foreigners, for those who can get into China but not the US it may be a good deal.