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Politics : Ask Michael Burke

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To: TimF who wrote (85644)11/18/2000 9:04:28 AM
From: Mike M2  Read Replies (1) of 132070
 
GDP attempts to capture spending and income flows but applying the hedonic deflator to create chain weighted GDP reflects spending that never took place. The economic benefit of productivity is that the increased dollar value output per man hour increases income in the form of higher profits and/or wages. Your lifestyle may be improved due to higher performance and or quality but it does little to boost incomes. No other major industrial nation uses hedonic pricing. In addition, last year the US became the only country which capitalizes software. Mike
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