Quote:
Originally Posted by opendoor
Sure, but that assumes that GDP per capita is a more important measure than things like median wages, net worth, etc. Some countries don't even use GDP per capita anymore because it gets distorted by international commerce.
Ireland is a good example. From 2012 to 2022, their GDP per capita went up 110%, including nearly 25% in 1 year. Why? Primarily because Apple increasingly shifted their non-US intellectual property there. So the GDP gets credited to Ireland, but the money flows from outside Ireland, through Apple's Irish subsidiary (which only exists because of low corporate tax rates), and then the profits flow back out to international investors. The actual country and its residents got very little benefit from that as evidenced by wage growth. As I mentioned, GDP per capita went up 110% in 10 years; in that same period, real wages in Ireland actually declined by 3.5%.
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On the other hand relative GDP changes to other nations is indicative of an issue. I think the Australia comparison is a good one to follow as you have resources based moderate sized economies. Also the comparison to where we sit in OCED is also a reasonable methodology. So I agree GDP is an imperfect measure but the trends in GDP are a negative indicator for Canada.