Wednesday, January 24, 2007

Macro Questions

I taught my first class yesterday and as is customary started with National Income Accounting. There were a couple of questions I could not answer right away.

1. Is recycled material counted as part of GDP, especially when something completely new and different is produced from them? What about recycled computers; i.e if the parts are melted down and made into something different?

2. If an individual holds dual citizenship, how does it affect GNP calculations? For tax purposes primary residence is considered, is it the same with GNP?

I did mention several times that there were tons of problems with these numbers and that they should take them with a pinch of salt. Hope the idea went across.

1 comment:

Jeremy said...

1. I assume recycling is considered a production process. Therefore the end products would be counted in national income accounts.

2. Since no one uses GNP anymore, this seems trivial. But I assume primary residence is used -- they may even follow the tax collectors, since that's what this is all about: stuff that can be taxed.

I wish you luck... I couldn't do it at this juncture.