Comment by CTDOCodebases
Comment by CTDOCodebases 2 days ago
Because children don’t contribute to GDP.
Comment by CTDOCodebases 2 days ago
Because children don’t contribute to GDP.
Consider two scenarios:
A. You have a child.
B. You don't have a child and decide to never have a child. To make up for the decline in population that year the government issues a working visa to an immigrant. The immigrant relocates to your country and sets up their life there.
Do you think that A or B raises GDP more?
Breaking news! There are no products or services in existence for anyone under the age of 18! lol
There are but who is producing them? Adults drive consumption and production. Children just drive consumption.
From an economic perspective increased immigration is better than births. Why have non productive people around when you can just import productive people that pay the government income taxes?
<sarcasm>If there are no children around then we don't have to worry about the children anymore and can worry about important things like the economy!</sarcasm>
> Because children don’t contribute to GDP
The simplest model of GDP is productivity per capital times population. And the simplest model in finance is moving cash flows around in time.
So who adds more to GDP:
A. A child of any age.
OR
B. A migrant worker.
My guess is B because that person can produce goods for export while consuming local goods. Children (at least for the first few years of their life or so) do not contribute to production. They only contribute towards consumption. You could argue that they motivate the parents to produce more but increasing skilled migration in the parents industry can do the same.
Of course they do. Everything a parent buys for a child increases GDP.
Bingo!
Some will argue that consumption drives production but according to the common definition children don’t contribute to GDP.
Assuming governments are going to address population growth/decline then it’s a choice between incentivising births or issuing visas.
Even in countries that have free healthcare births are in decline so it’s not the cost of children alone that is causing this situation. I would argue it’s the economic crutch called immigration.
Having a child definitely more than doubled my contributions to the GDP.