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It's not that the current residents of those cities would become more productive; it's that people currently living elsewhere are less productive in those other
by raldi 12y ago
It's not that the current residents of those cities would become more productive; it's that people currently living elsewhere are less productive in those other places than they would be if they moved to NY, SF, or SJ.
So if those cities built lots more homes, people would rush in from elsewhere, and those newcomers would be more productive in their new locations than they were in their old ones, increasing US GDP 9.5%.
- adventured 12y agoIt's the ~$1.7 trillion boost to GDP that is difficult to believe. The entire GDP of all of California combined is $2 trillion. It's blatantly obvious that 9.5% GDP boost is a fraudulent number.
- raldi 12y agoIt's possible that there are errors in the reasoning, but I think you're taking things a step too far with "blatantly obvious" and "fraudulent". Why not read the study and look for oversights?
- adventured 12y agoIt is blatantly obvious. When you're talking about a sum almost as large as California's entire economy, I don't believe it can be anything but obvious.
- NhanH 12y agoThought experiment: If alien landed on NYC and SF, then decided to abduct everyone in the two cities and wipe out the cities, how much of a reduction in US GDP it would be for the next year?
- bane 12y agoGDP affects the entire country not just these localities and cities network into and recruit huge areas around them. NYC isn't Boulder, CO. It has global reach, and actions taken in New York can affect the movement of money all over the planet. An example, suppose somebody can suddenly afford to live in NYC, where they get a job moving commodities through an import/export business. Their contribution to NYC's GDP is minor: salary and profit on the deals they make. By getting this person into position to make these deals, American commodity producers suddenly get additional access to global markets they might not have had otherwise and suddenly corn from Stoy, Illinois is finding its way to China and Wheat from Russell, Kansas is ending up in Germany. Moving those commodities employs truckers, truck manufacturers, ship crews, cargo container companies, shipping companies, etc. and all of those additionally network and recruit other industries: fuel, navigation, refrigeration, packaging, etc. So while our NYC broker friend might only contribute a fraction of a fraction of a percent to NYC's economy (maybe not even a million dollars all told), his impact on the U.S. economy is vastly magnified. He may single-handedly connect enough sellers to enough buyers to keep hundreds of people fully employed and cause tens of millions of dollars of value to be created and distributed. The alternative to him not being in place? The crops go to waste, or the farmers are simply paid to not grow them.
- adventured 12y agoYou're talking about a sum equal to the entire economy of New York City and SF combined. A boost to NYC and SF through some (even a lot of) population expansion, will not exceed the total existing GDP of all of NYC + SF. It's an absurd premise.
- bane 12y agoNo, I'm saying that the national GDP contributions of a city like NYC far exceed that city's local GDP contribution. In other words, NYC does not exist as a closed system. You don't seem to understand that.
- ThrustVectoring 12y agoEstimates for positive externalities per dollar of salary range from -0.5 to 2.0, depending on political assumptions on what the value of, say, banking and teaching is. Like, it helps, but it doesn't seem like the numbers still add up.