Gross Domestic Potential
Posted on December 11th, 2016
by Rab Bruce’s Spider
A Twitter comment by Rev Stuart Campbell of Wings Over Scotland prompted me to do a little investigation into GDP.
GDP, or Gross Domestic Product, to give it its full name, is a fairly crude measurement of a country’s ability to generate wealth. Theoretically, it includes all the money generated within an economy, so every pound you spend adds to GDP. It’s a figure which is open to manipulation, as has been seen when the UK recently overtook countries like France by including estimates of the money spent on drugs and prostitution as counting towards GDP.
But, as a measure of comparability, it’s commonly used to show where a country stands in economic terms, particularly when it is expressed as a figure of the GDP per person. This is usually referred to as GDP per capita. In order to compare countries, the figure is normally expressed in US Dollars. After a quick Google search, I found a comparative list of nearly 300 countries and territories, and pulled out the figures for a few relatively well-off countries.
The UK’s figure includes Scottish GDP and, while it is impossible to be definitive, Scotland’s GDP is estimated in official Scottish Government statistics as being $41,180 per person.
Yes, that’s right. Scotland, even with its economy hampered by being part of the UK, would be placed at 26th on the list, above such poverty-stricken countries as Germany, Sweden, France and Japan to name but a few.
It’s also worth noting that Scotland becoming independent and its GDP per capita being stripped out of the UK’s figures would see the RUK slipping even further down the table.
Now, it is important to bear in mind that GDP per capita is only one measurement and it is by no means the only figure which shows a country’s wealth. It is, however, an indicator of a country’s ability to generate wealth. What it does with that wealth will contribute to other economic measures such as National Debt, Balance of Payments, inflation, etc. But, in terms of potential to be wealthy, the GDP per capita puts Scotland in a very healthy place indeed.
So why does anyone believe Scotland is too wee and too poor to be independent?