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I think it's time to switch from GDP per capita to household income. You might think the two are practically the same, and globally that's true, but at the regi
by t_mann 1y ago
I think it's time to switch from GDP per capita to household income. You might think the two are practically the same, and globally that's true, but at the regional level there can be stark discrepancies.
One example: Ireland's GDP grew a staggering 25% in 2015 [0], mainly because Apple decided to book more of their profits there. It does lead to higher tax revenue, but creates relatively few jobs or other income there. The profits go to Apple shareholders, who mainly live outside Ireland. Household income would more adequately reflect where those benefits go than GDP.
Plus, with household income it's more natural to look at the median in addition to the mean, which is the more robust metric, statistically speaking.
[0] https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locations=IE https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locat...
- TheOtherHobbes 1y agoI think income is still too crude and misleading. You really need some kind of complex individual economic health measure made of many indicators. But a more informative proxy would be median net worth - individual, not household, with married couple net worth divided by two for simplicity - as a fairly simple assets vs liabilities calculation. The net worth distribution would be even more revealing because it would highlight the difference between owners and renters. This still doesn't reveal net worth stability. In the US you can - and many people do - go from a seven figure net worth to bankruptcy because of a health crisis or (increasingly) a climate disaster. So you'd want a supplemental distribution showing how variable net worth is, how many people are reduced to bankruptcy at each decile, and how much movement there is in each decile. Reducing these kinds of complexities to a single number seems misleading at best.
- deleted 1y ago[deleted]