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"And no, GDP will not drop. Current productive [..]" I don't understand what you are saying there. GDP is a function of spending in the economy. If there is a
by RobertoG 6y ago
"And no, GDP will not drop. Current productive [..]"
I don't understand what you are saying there. GDP is a function of spending in the economy. If there is a fall in investment there is a fall in spending. If it's not compensate somehow, GDP will fall.
"[..] than have their labor and capital output diverted to projects that will provide them with less resources than they put in."
I don't understand that neither. Is better to have people unemployed than put those people to work?
- CryptoPunk 6y agoSpending doesn't decrease when investment drops. The spending is reallocation to consumer spending.