The costs and benefits of producing or importing

[Supposn]

The costs and benefits of producing or importing:

The expenditure formula itself only reduces or increases GDP by the nation's net trade balance which is based upon the price value of globally traded products. But there's often additional production supporting goods and services that are not fully paid for by product producers, and are not reflected within the products price valuation.

For example, it's not unusual for governments and universities to boost local economies by providing producers with valuable research and development at lesser than market value or costs; government infrastructure that favors an important producer or industries; training and education tailored to serve a particular company or industry. These all increase their nation's GDP but if they are not reflected within the prices of exported products, exports full contributions to the nation's GDP are not attributed to the nation's global trade.

OK, national trade surpluses are understated, but doesn't that mean the importing nation's getting a bargain; they're getting more than they paid for? Well yes and no.

The exporting nation is the nation that earned the benefits of production. It is their nation that gains the knowledge and experience derived from using the tools and manipulating the materials of production. It is their universities that produced the research and development. It is their nation that built and improved the infrastructures that supported their producers and also serves others.

The reduced costs of imported products rather than domestic production costs are often at some costs to our government. To the extent laid-off workers previous incomes cannot be sustained, the enterprise's costs savings are often to some extent reflected by government's reduced tax revenues and increase unemployment costs.
When a service enterprise is displaced, other enterprises are often established elsewhere in the nation. Production of goods very often do not require close proximity to the customer and are often outsourced to lower wage rate nations.

It's unusual for a commercial enterprise not to require some products or services of other enterprises. Production moved beyond our borders, are usually supported by foreign enterprises. Even if a production supporting enterprise have other customer and/or serves other industries, their lesser production or sales volumes may increase their per-unit costs to the extent that they too cannot continue functioning within the nation.

There are benefits and costs of production; there are far fewer benefits and significant costs for nations that do not produce.

Respectfully, Supposn

 

[Toddsterpatriot]

The costs and benefits of producing or importing:

The expenditure formula itself only reduces or increases GDP by the nation's net trade balance which is based upon the price value of globally traded products. But there's often additional production supporting goods and services that are not fully paid for by product producers, and are not reflected within the products price valuation.

For example, it's not unusual for governments and universities to boost local economies by providing producers with valuable research and development at lesser than market value or costs; government infrastructure that favors an important producer or industries; training and education tailored to serve a particular company or industry. These all increase their nation's GDP but if they are not reflected within the prices of exported products, exports full contributions to the nation's GDP are not attributed to the nation's global trade.

OK, national trade surpluses are understated, but doesn't that mean the importing nation's getting a bargain; they're getting more than they paid for? Well yes and no.

The exporting nation is the nation that earned the benefits of production. It is their nation that gains the knowledge and experience derived from using the tools and manipulating the materials of production. It is their universities that produced the research and development. It is their nation that built and improved the infrastructures that supported their producers and also serves others.

The reduced costs of imported products rather than domestic production costs are often at some costs to our government. To the extent laid-off workers previous incomes cannot be sustained, the enterprise's costs savings are often to some extent reflected by government's reduced tax revenues and increase unemployment costs.
When a service enterprise is displaced, other enterprises are often established elsewhere in the nation. Production of goods very often do not require close proximity to the customer and are often outsourced to lower wage rate nations.

It's unusual for a commercial enterprise not to require some products or services of other enterprises. Production moved beyond our borders, are usually supported by foreign enterprises. Even if a production supporting enterprise have other customer and/or serves other industries, their lesser production or sales volumes may increase their per-unit costs to the extent that they too cannot continue functioning within the nation.

There are benefits and costs of production; there are far fewer benefits and significant costs for nations that do not produce.

Respectfully, Supposn

The expenditure formula itself only reduces or increases GDP by the nation's net trade balance which is based upon the price value of globally traded products.

Holding everything else steady, an additional import of $1 reduces GDP by $1.
Even if your net exports was positive.

 

[Supposn]

The costs and benefits of producing or importing:

The expenditure formula itself only reduces or increases GDP by the nation's net trade balance which is based upon the price value of globally traded products. ...

... Holding everything else steady, an additional import of $1 reduces GDP by $1.
Even if your net exports was positive.

ToddsterPatriot, that's true. But the entire effects of international trade upon their nation's GDP, (including the leveraged factor portion that's not identified and recognized as due to the nation's global trade), generally affect the nation's GDP to the extent of their net balance of trade.

Global trades effects upon GDPs of both trade surplus, or trade deficit nations are to some extent understated. Those effects to some extents exceed their nation's net balances of trade.
Respectfully, Supposn

 

[Toddsterpatriot]

The costs and benefits of producing or importing:

The expenditure formula itself only reduces or increases GDP by the nation's net trade balance which is based upon the price value of globally traded products. ...

... Holding everything else steady, an additional import of $1 reduces GDP by $1.
Even if your net exports was positive.

ToddsterPatriot, that's true. But the entire effects of international trade upon their nation's GDP, (including the leveraged factor portion that's not identified and recognized as due to the nation's global trade), generally affect the nation's GDP to the extent of their net balance of trade.

Global trades effects upon GDPs of both trade surplus, or trade deficit nations are to some extent understated. Those effects to some extents exceed their nation's net balances of trade.
Respectfully, Supposn

an additional import of $1 reduces GDP by $1.

ToddsterPatriot, that's true.

Thanks.
Why did it take you so long to come around?

 

[Supposn]

ToddsterPatriot, that's true. But the entire effects of international trade upon their nation's GDP, (including the leveraged factor portion that's not identified and recognized as due to the nation's global trade), generally affect the nation's GDP to the extent of their net balance of trade.
Global trades effects upon GDPs of both trade surplus, or trade deficit nations are to some extent understated. Those effects to some extents exceed their nation's net balances of trade.
Respectfully, Supposn

an additional import of $1 reduces GDP by $1.

ToddsterPatriot, that's true.

Thanks.
Why did it take you so long to come around?

Toddsterpatriot,: you're questioning the consistency of my posts?

Trade surpluses are always net contributors and trade deficits are ALWAYS net detrimental to their nation's GDP. The extents of the contributions or detriments almost always, (if not actually always) annually exceed, and are never less than the extents of their nation's international trade balances.

Respectfully, Supposn

 

[Toddsterpatriot]

ToddsterPatriot, that's true. But the entire effects of international trade upon their nation's GDP, (including the leveraged factor portion that's not identified and recognized as due to the nation's global trade), generally affect the nation's GDP to the extent of their net balance of trade.
Global trades effects upon GDPs of both trade surplus, or trade deficit nations are to some extent understated. Those effects to some extents exceed their nation's net balances of trade.
Respectfully, Supposn

an additional import of $1 reduces GDP by $1.

ToddsterPatriot, that's true.

Thanks.
Why did it take you so long to come around?

Toddsterpatriot,: you're questioning the consistency of my posts?

Trade surpluses are always net contributors and trade deficits are ALWAYS net detrimental to their nation's GDP. The extents of the contributions or detriments almost always, (if not actually always) annually exceed, and are never less than the extents of their nation's international trade balances.

Respectfully, Supposn

Toddsterpatriot,: you're questioning the consistency of my posts?

Consistently.

Trade surpluses are always net contributors and trade deficits are ALWAYS net detrimental to their nation's GDP.

Exports are always contributors and imports are ALWAYS detrimental to their nation's GDP.

 

[Supposn]

Toddsterpatriot,: you're questioning the consistency of my posts?
Consistently.

Trade surpluses are always net contributors and trade deficits are ALWAYS net detrimental to their nation's GDP.
Exports are always contributors and imports are ALWAYS detrimental to their nation's GDP.

Toddsterpatriot, exports are always contributors and imports are ALWAYS detrimental to their nation's GDP, but only to the extent that one exceeds the other.
Respectfully, Supposn

 

[Toddsterpatriot]

Toddsterpatriot,: you're questioning the consistency of my posts?
Consistently.

Trade surpluses are always net contributors and trade deficits are ALWAYS net detrimental to their nation's GDP.
Exports are always contributors and imports are ALWAYS detrimental to their nation's GDP.

Toddsterpatriot, exports are always contributors and imports are ALWAYS detrimental to their nation's GDP, but only to the extent that one exceeds the other.
Respectfully, Supposn

exports are always contributors

Yes.

and imports are ALWAYS detrimental to their nation's GDP

Yes

but only to the extent that one exceeds the other.

Wrong. You understood in post #3. What changed?

 

[Supposn]

exports are always contributors

Yes.

and imports are ALWAYS detrimental to their nation's GDP

Yes

but only to the extent that one exceeds the other.

Wrong. You understood in post #3. What changed?

ToddsterPatriot, there's no contradiction. Imports and exports cancel each other out and have no effect upon GDP unless one exceeds the other. USA spent a finite amount of dollars purchasing final products during the year.

We increase that amount by our exports because we produced them, but they were purchased by foreign buyers that were not included within the amounts paid by USA purchasers.

We decrease that amount by our imports because we did not produce them. But they were purchased by USA buyers and included within the amounts paid by USA purchasers.

It's that simple.

Respectfully, Supposn

 

[Toddsterpatriot]

exports are always contributors

Yes.

and imports are ALWAYS detrimental to their nation's GDP

Yes

but only to the extent that one exceeds the other.

Wrong. You understood in post #3. What changed?

ToddsterPatriot, there's no contradiction. Imports and exports cancel each other out and have no effect upon GDP unless one exceeds the other. USA spent a finite amount of dollars purchasing final products during the year.

We increase that amount by our exports because we produced them, but they were purchased by foreign buyers that were not included within the amounts paid by USA purchasers.

We decrease that amount by our imports because we did not produce them. But they were purchased by USA buyers and included within the amounts paid by USA purchasers.

It's that simple.

Respectfully, Supposn

Imports and exports cancel each other out and have no effect upon GDP unless one exceeds the other.

Wrong, as you already admitted in post #3.

Assume we have a $1,000,000,000 trade surplus.
Holding everything else constant, an additional $500,000,000 in imports reduces GDP by $500,000,000.
Holding everything else constant, an additional $1,000,000,000 in imports reduces GDP by $1,000,000,000.
Holding everything else constant, an additional $2,000,000,000 in imports reduces GDP by $2,000,000,000.

It's that simple.​

 

[Supposn]

Imports and exports cancel each other out and have no effect upon GDP unless one exceeds the other.

Wrong, as you already admitted.
Assume we have a $1,000,000,000 trade surplus.
Holding everything else constant, an additional $500,000,000 in imports reduces GDP by $500,000,000.
Holding everything else constant, an additional $1,000,000,000 in imports reduces GDP by $1,000,000,000.
Holding everything else constant, an additional $2,000,000,000 in imports reduces GDP by $2,000,000,000.
It's that simple.

ToddsterPatriot, OK, I now see what you're thinking.

Assuming USA's 2019 GDP will have reached exactly 1 billion dollars on January 10 of 2019;
USA had a grand holiday and didn't produce anything for the next 5 days because we will all oversleep until January 16, 2019.
At 1 AM. January 16, 2019, we will purchase and receive and enter into our account books the transactions for a half billion dollars of imports.
Consequentially the USA will spend 1.5 billion dollars by January 16, and USA's GDP up to then will be
($1.5B – $0.5B) = $1.0 billion, which will be no change from our GDP between the first and the 16th day of January 2019.
Are we now on the same page? Respectfully, Supposn​

 

[Supposn]

ToddsterPatriot, I'm telling you that the entire economic difference between a similar domestic or an imported product occurs prior to the domestic product reaching its producer's shipping platform, or prior to the imported product began being handled entirely by domestic entities and labor. That half billion dollars spent for imported products crowded a half billion dollars of domestic goods out of our markets.

Additionally, it reduced what would otherwise have been USA production by some amount in excess of a half billion dollars.
//////////////////////////

Unlike spending for domestic products, spending that contributes to a trade deficit, (i.e. a negative balance of global trade), somewhat reduces, rather than increasing their nation's GDP. But GDP can only report what has been actually domestically produced in spite of our negative exports.

GDP cannot report what may have been produced if we did not spend for negative exports. Annual trade surplusses always increase, and trade deficits always decrease their nation's GDP more than otherwise. The extent of global trades' actual effects upon their nation's GDPs almost always, (if not always) exceeds, and is never less than the extent of their nation's net global balance of trade.

Respectfully, Supposn

 

[Supposn]

Annual balances of trade indicate if their nation’s production of goods and services exceeded or was less than the nation’s purchases (of final products). All creditable economists agree, trade surpluses contribute, and trade deficits are detrimental to their nation’s GDP.

USA is a chronic annual trade deficit nation. USA’s annual trade deficits are greater than that of any other nation. Many economists contend due to USA’s annual trade deficits’ lesser proportions to our GDPs and our lesser dependence upon exporting, our trade deficits detriments to our annual GDPs are of lesser significance.

I’m in agreement with economists contending that those economists are not considering the multiplier effects due to production of goods or service products. Producers are often the beneficiaries of goods and services at lesser than “market-price”. Due to competitive pressures, the values of those reduced production subsidies are not reflected within the producers’ prices of their goods, but all of the nation’s production does contribute to their GDP. Domestic production not reflected within the price valuations of exported products, are not recognized and attributed to global trade’s contributions to their nation’s GDP. To those extents, trade surplus nations additional GDP due to their balance of trade, exceed their net balance of trade; (i.e. trade surpluses understate their contributions to their nation’s GDP).

Similarly, for the same reasons, annual trade deficits “crowding” of their nation’s domestic products from their domestic markets, exceed the amount of the deficit itself; (i.e. trade deficts understate their detrimental effects upon their nation’s GDP).

Respectfully, Supposn