India's per capita income rises 7.4% to Rs 93,293

[Nilgiri]

GNP vs NNP is an interesting topic. But keep in mind that different countries and firms use different rates of depreciation. This creates problems.

As an accountant, we often find the average payment of something over time (like rent), so that we can expense it at the same amount each month, and we start "expense-ing" when the business starts operations, regardless of when we begin paying. We do this because if we were to expense the exact payment amount, exactly when we payed, it would distort the financials of the firm a bit for reasons unrelated to business itself. Business activity might not have changed, but expenses would, for reasons unrelated to business. While the concept is a bit different, adjusting for depreciation may make the NNP amount for country fluctuate due to depreciation for reasons unrelated to economic activity itself, I believe. It could distort comparisons between years.

And most importantly, because of the differences between countries when it comes to calculating depreciation, it would make them more difficult to compare to each other.

Yah very true. You indeed go into a lot of depth.

Earlier in the thread I just summarised it as "GDP has the least complexity accounting wise". Making things "better" adds more scope for fudge factors like you have mentioned....I referenced those as different "standards" in this thread.

I've probably lost enough people that are reading that already, but I do appreciate your clarification on different depreciation possibilities, I hadn't really thought of that specifically but it sure makes a lot of sense.

Even with GNP/GNI there is a problem in getting accurate figures/estimates for nationals living abroad, especially if there are DTAAs and such.

I guess thats another reason why GDP is somewhat of the gold standard given its relative simplicity. Just count up everything that goes on within your political borders...whoever is the producer/consumer and whatever their origins are.

Even if it did, could he compare it to India or other countries? He should make comparisons within a single source. Unless of course a source that publishes NNI/NNP amounts by country also used the same figures in this report for their own Bangladesh NNI/NNP figures.

Yup it would just be a basic start for sure for comparison (with disclaimers of course).

I wonder what country he thinks I'm from exactly.

I dunno, maybe he has an issue with you using 2 US flags instead of Pakistan and US.

Buts its really a moot point given your handle and DP.

 

[LA se Karachi]

Yah very true. You indeed go into a lot of depth.

Earlier in the thread I just summarised it as "GDP has the least complexity accounting wise". Making things "better" adds more scope for fudge factors like you have mentioned....I referenced those as different "standards" in this thread.

That's a good way to put it.

I've probably lost enough people that are reading that already, but I do appreciate your clarification on different depreciation possibilities, I hadn't really thought of that specifically but it sure makes a lot of sense.

I'm particularly averse to depreciation being an accountant, because firms typically don't calculate it in regards to business activity. They usually calculate it based on time, not actual use. The figures are used more to lower their taxable income. Taken alone, the figure is not necessarily a good indicator of the actual depreciation in value of the asset.

I haven't really looked into how NNP depreciation is calculated for countries. You probably know more about that than me. But I assume that their calculations will have similar issues, distorting comparisons by country or year. My guess is that these are the biggest reasons NNP isn't the metric used to compare national economies (among others).

I dunno, maybe he has an issue with you using 2 US flags instead of Pakistan and US.

Buts its really a moot point given your handle and DP.

That was the dilemma I faced when I was creating an account. If I remember correctly, the site said that the first flag is typically where you were born. I was born in the U.S. and have lived here my whole life. I also didn't want to give people the impression that I was born in Pakistan and moved when I got older (though I visited Pakistan often from an early age and can understand/speak Urdu).

But ya, I hope that people would be able to figure out that I'm Pakistani-American.