I agree with the substantive point that the changes in living standards we ultimately care about come from productivity growth, not GDP growth as such.
Now for the inevitable disagreements/critiques:
The post title, “Increasing GDP is not growth”, isn’t actually true as such. Referring to increasing GDP as economic growth isn’t a weird LW/transhumanist/etc. affectation; it’s totally normal & conventional. If I heard a newsreader talking about economic growth, I’d guess they were most likely talking about (inflation-adjusted) GDP going up.
The people I most associate with this kind of immigration-grows-GDP meme are single-issue-ish advocates of open borders, but AFAIK they refer to immigration increasing global GDP (which is kind of a strange usage of “GDP”, since the “D” does after all stand for “domestic”, but that’s what they say). It’s right there in the title bar. This avoids the issue of country-level GDP being dependent on how one draws lines on a map.
It took me a moment to realize the post wasn’t using “productivity” in the conventional economist’s sense (at least when talking at the national level), namely labour productivity, which is output per worker or output per hour worked. This is distinct from output per person, and made the references to “productivity per person” momentarily confusing (because with the conventional understanding of productivity, writing “productivity per person” is a bit like writing “GDP per capita per person”).
PhilGoetz probably knows this already, but I don’t know whether everyone reading this does: some advocates of higher immigration explicitly expect immigration to raise productivity, specifically of workers who come from lower-productivity countries to higher ones. The usual term for this is the “place premium”. A Google search brings back among other things an illustrative working paper by Michael Clemens, Claudio Montenegro, and Lant Pritchett.
These are all excellent points. The increase in labor productivity accruing to immigrants to e.g. the US is often discussed by economists. I’ll grant that it’s not often discussed in general media, which is part of PhilGoetz’s point, but I’m sure I’ve seen it there too.
Also, many economists have argued that in certain contexts immigration (even low-skilled) does result in economic gains for the native born. The argument goes that immigrants’ negative impact on native born wages is small and that this small change is more than offset by the immigrants’ ability to make domestic goods cheaper. People earn less, but things cost less still. In this scenario GDP per person has gone down, but native born purchasing power has increased. And the immigrants are far better off- their labor productivity has increased through the place premium and (related) their wages are almost certainly higher than they would be in their country of origin.
A final point:is that total GDP in some contexts can actually be a good in itself. Having a country with a large GDP is very meaningful politically. The fact the Norway and Qatar have higher GDP per capita than the US is meaningful and worthy of discussion, but the US matters far more to global politics and it’s due primarily to one reason- the US is responsible for one quarter of the entire world’s nominal GDP. Along some margin, allowing immigration that lowers GDP per capita but raises total GDP can be beneficial to members of a country purely based on international economic strength.
Related to your second paragraph, I was intrigued when I saw economists pointing out that even low-skilled immigrants could raise natives’ productivity & income by (1) nudging natives to upskill and move into higher-skill jobs, and (2) lowering childcare & housework costs, making it easier for native women to work paid jobs.
I agree with the substantive point that the changes in living standards we ultimately care about come from productivity growth, not GDP growth as such.
Now for the inevitable disagreements/critiques:
The post title, “Increasing GDP is not growth”, isn’t actually true as such. Referring to increasing GDP as economic growth isn’t a weird LW/transhumanist/etc. affectation; it’s totally normal & conventional. If I heard a newsreader talking about economic growth, I’d guess they were most likely talking about (inflation-adjusted) GDP going up.
The people I most associate with this kind of immigration-grows-GDP meme are single-issue-ish advocates of open borders, but AFAIK they refer to immigration increasing global GDP (which is kind of a strange usage of “GDP”, since the “D” does after all stand for “domestic”, but that’s what they say). It’s right there in the title bar. This avoids the issue of country-level GDP being dependent on how one draws lines on a map.
It took me a moment to realize the post wasn’t using “productivity” in the conventional economist’s sense (at least when talking at the national level), namely labour productivity, which is output per worker or output per hour worked. This is distinct from output per person, and made the references to “productivity per person” momentarily confusing (because with the conventional understanding of productivity, writing “productivity per person” is a bit like writing “GDP per capita per person”).
PhilGoetz probably knows this already, but I don’t know whether everyone reading this does: some advocates of higher immigration explicitly expect immigration to raise productivity, specifically of workers who come from lower-productivity countries to higher ones. The usual term for this is the “place premium”. A Google search brings back among other things an illustrative working paper by Michael Clemens, Claudio Montenegro, and Lant Pritchett.
These are all excellent points. The increase in labor productivity accruing to immigrants to e.g. the US is often discussed by economists. I’ll grant that it’s not often discussed in general media, which is part of PhilGoetz’s point, but I’m sure I’ve seen it there too.
Also, many economists have argued that in certain contexts immigration (even low-skilled) does result in economic gains for the native born. The argument goes that immigrants’ negative impact on native born wages is small and that this small change is more than offset by the immigrants’ ability to make domestic goods cheaper. People earn less, but things cost less still. In this scenario GDP per person has gone down, but native born purchasing power has increased. And the immigrants are far better off- their labor productivity has increased through the place premium and (related) their wages are almost certainly higher than they would be in their country of origin.
A final point:is that total GDP in some contexts can actually be a good in itself. Having a country with a large GDP is very meaningful politically. The fact the Norway and Qatar have higher GDP per capita than the US is meaningful and worthy of discussion, but the US matters far more to global politics and it’s due primarily to one reason- the US is responsible for one quarter of the entire world’s nominal GDP. Along some margin, allowing immigration that lowers GDP per capita but raises total GDP can be beneficial to members of a country purely based on international economic strength.
Related to your second paragraph, I was intrigued when I saw economists pointing out that even low-skilled immigrants could raise natives’ productivity & income by (1) nudging natives to upskill and move into higher-skill jobs, and (2) lowering childcare & housework costs, making it easier for native women to work paid jobs.