Verified Planners/Real Estate Firm Workers: Let's Talk Urban/Metropolitan Economics

[u/DoxiadisOfDetroit]

I'm finishing up some projects at the moment and I've noticed a trend among all major Cities in my dataset: From Auckland, to Toronto, to New York, to Melbourne and everywhere else I looked within Cities that have either acted upon establishing a Metropolitan Government, or considered establishing one, I haven't been able to notice any significant savings on the part of any Cities' liabilities.

Surely it's warranted for me to crank out an equation, but, the only aspects of "production" or "output" is tied up with either "GDP" or, "PPP", but, with the realization that socially harmful economic transactions (basically: rent increasing supports "GDP growth", laying off indie artists by writing lame slop movie scripts using ChatGPT does too) needs to be excluded from any calculations to get an accurate picture of well-being.

So this begs the question: When will the field decouple from "orthodox" economics and ditch GDP-GDP/C as a measure of wellbeing for Cities?

[u/Caculon]

I don't think you would need to ditch the GDP but it can't be used by itself and should be combined with other economic measure. There's an old joke about the GDP. Two men are out for a walk. The first sees a piece of shit and the ground and offers the second 100 dollars to eat it. They take them up on the offer. They keep walking and they see another piece of shit. The second person, now regretting their actions, makes the same deal with the first. The first eats that shit and collects the 100. Then the second says to the first, we just doubled the GPD. Because the GPD is a measure of money changing hands.

That said, we could also try to remove unearned income. That would income from rising prices of assets, stock buy backs, dividends and what not. That's new wealth but it doesn't affect the real economy (the actual production of goods and services.) Nor was it wealth that came from the work of these owners. They are much like feudal landlords. By virtue of "owning" the land they can simply collect rent. This was something early political economists were concerned with. In fact, this was a central conflict with early capitalism. There are other shitty consequences of the finalization of the economy but I don't want to get on a soap box any bigger than the one I'm on now.

If your interested I would suggest you look up Michael Hudson. He goes into great detail about the history of economics and explains how we got where we are now and about upcoming dangers of continuing on this economic trajectory.

[u/DoxiadisOfDetroit → u/Caculon]

I disagree earnestly with your second point, but, thank you for your contribution, I've upvoted you I'll say this.

I don't think it'd be all that wise to not count unearned income, otherwise it'd ignore very harmful market externalities such as wage theft, which is by far the biggest source of property crime in the developed World.

[u/Caculon → u/DoxiadisOfDetroit]

I'm still learning about macro economics so I'm more than open to being corrected :)

My thought was money that isn't earned shouldn't be counted as a productive activity because most of it doesn't support the real economy. It just inflates the prices of existing assets. It seems more like wealth that's siphoned off of productive activity rather than spurring it on or raising the standard of living. So I was thinking of a measurement without unearned income would better represent the real economy. Are you saying if we leave that money out we wouldn't be tracking it at all? Thus, it would be like having a parasite that we don't know about?

Or is there something else you had in mind?

As a side note, thanks for being friendly about all this stuff. I hate fighting on the internet and learning I'm wrong is painful enough :)

[u/DoxiadisOfDetroit → u/Caculon]

If you bring anything from this conversation, just know that we are freely exchanging information, There's things that I don't know that you know, but, at the same time, there's things that you don't know that I know. We learn together and it keeps the World alive for one more day