Tuesday, June 12, 2007

Economist Morton Marcus on Indiana's GDP

The Indiana Economic Digest has posted a copy of economist Morton Marcus's latest column, which addresses the gross domestic product numbers I posted last week. It is well worth the read. (Hat tip: Taking Down Words.)

"Let me put it another way. In 2006, Indiana ranked 33rd in GDP per capita among the 50 states. That says 64% of the states (after adjusting for the population size of the states) put goods and services into the market that are more highly valued than are those sold by Indiana firms.

"In 2003 we ranked 29th in per capita GDP. During just the past four years we have been passed by Vermont, North Dakota, Tennessee, and Kansas. Farming pushed North Dakota ahead, but it was durable goods manufacturing thatworked for Vermont, Tennessee and Kansas.

"In six of the last nine years, including all three of the last three years, Indiana has failed to grow as rapidly as the nation in total GDP. We are becoming less significant as a part of the U.S. in both economic and political terms. We had 2.04% of US GDP in 1997 and our share was down to 1.89% in 2006."

"And that means to me?" Fergus asked again.

"That means we'll see fewer retail initiatives in Indiana. We'll see fewer firms and households interested in locating where 'nothing is happening'. It means we'll have less clout in national councils and eventually suffer the loss of still another member of congress."

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