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Urban Growth – Population, GDP, COL, etc.


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So over the years in internet discussions I've used both TN and MA growth as illustrations of the difference local policy makers can make to the fortunes of states. The former has been outgrowing the latter every year and so anticipating the swapping of their population rankings has been sort of a background interest. The puzzle is this: I came upon a website that shows that swap in 2021 stats. They also show Mass as fewer population in 2021 than the 2020 census results. Here is their page for TN: https://worldpopulationreview.com/states/tennessee-population  and the page for MA: https://worldpopulationreview.com/states/massachusetts-population

Anyone know the nitty-gritty on that website and more to the point what is the actual current rankings of the two states?

Edited by dragonfly
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What piqued my interest in 2007 was a WSJ feature article on the economic status of Houston which at that time was growing very fast, almost at the same rate as 'Austin at about 3.5+ times the metro p

12 hours ago, dragonfly said:

what is the actual current rankings of the two states

The latest official data for TN and MA are from the 2020 Census.
TN: 6,910,840

MA: 7,029,917

I poked around that webpage's sources and couldn't find any applicable 2021 data. The TN SDC has 2021 data, but its out of date and doesn't account for the 2020 Redistricting data.

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46 minutes ago, dragonfly said:

 

What piqued my interest in 2007 was a WSJ feature article on the economic status of Houston which at that time was growing very fast, almost at the same rate as 'Austin at about 3.5+ times the metro population of Austin. These economic figures are fairly difficult to understand and here is what is confusing. The article stated that the Houston workforce was essentially 1/2 the productivity of the NYC workforce which according to the per capita GDP interpretation means that NYC per capita GDP is twice that of Houston. If you drill down that means that cab drivers in NYC produce twice as much as their Houston counterparts, teachers produce twice as much, police officers produce twice as much, as do  auto mechanics, etc etc. Is this really the case? Do auto mechanics in NYC fix twice as many vehicles as the ones in Houston? Do average passenger miles driven by cab drivers in NYC equal twice those in Houston? Of course not. The difference between Houston and NYC metros is vast in several arenas. Taxation is drastically different. Land use policy, and availability is drastically different, resulting in housing costs and real estate taxes drastically diverging. Thus Houston metro population was booming in 2007 while NYC metro population was stagnant by comparison. Policy has as much to do with this as does land availability. The same goes with MA and TN. If you are going to compare per capita GDP growth between the two states as the only driver of population growth, you get nonsense in your analysis. Something else has to be driving the difference in population growth between TN and MA and guess what? It is per capita GDP corrected for COL, and below is the spreadsheet that proves it. Corrected for COL, TN per capita GDP in 2016 was $52,355. In MA it was $47,889. In TX, $65,168; in NY $53,766. 

Link: https://docs.google.com/spreadsheets/d/1Fa8tNa48ct5vxz2UdgH-0TTlgms6mKdbO71QinDfQZo/edit#gid=155632612

Was hoping someone was going to weigh in on this. Nice job Dragonfly!

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10 hours ago, dragonfly said:

 

What piqued my interest in 2007 was a WSJ feature article on the economic status of Houston which at that time was growing very fast, almost at the same rate as 'Austin at about 3.5+ times the metro population of Austin. These economic figures are fairly difficult to understand and here is what is confusing. The article stated that the Houston workforce was essentially 1/2 the productivity of the NYC workforce which according to the per capita GDP interpretation means that NYC per capita GDP is twice that of Houston. If you drill down that means that cab drivers in NYC produce twice as much as their Houston counterparts, teachers produce twice as much, police officers produce twice as much, as do  auto mechanics, etc etc. Is this really the case? Do auto mechanics in NYC fix twice as many vehicles as the ones in Houston? Do average passenger miles driven by cab drivers in NYC equal twice those in Houston? Of course not. The difference between Houston and NYC metros is vast in several arenas. Taxation is drastically different. Land use policy, and availability is drastically different, resulting in housing costs and real estate taxes drastically diverging. Thus Houston metro population was booming in 2007 while NYC metro population was stagnant by comparison. Policy has as much to do with this as does land availability. The same goes with MA and TN. If you are going to compare per capita GDP growth between the two states as the only driver of population growth, you get nonsense in your analysis. Something else has to be driving the difference in population growth between TN and MA and guess what? It is per capita GDP corrected for COL, and below is the spreadsheet that proves it. Corrected for COL, TN per capita GDP in 2016 was $52,355. In MA it was $47,889. In TX, $65,168; in NY $53,766. 

Link: https://docs.google.com/spreadsheets/d/1Fa8tNa48ct5vxz2UdgH-0TTlgms6mKdbO71QinDfQZo/edit#gid=155632612

 

If your claims are that the population of Texas is growing faster than the population of Massachusetts and that the cost of living in Texas is lower than the cost of living in Massachusetts, I've got no disputes with those assertions whatsoever.  I'd also like to point out that there's a lot that I like about Texas, so I hope you're not taking this personally.

That said, nothing that you wrote in your post above addresses the fact that the per capita GDP of Massachusetts has been growing at a faster rate than the per capita GDP of Texas for the last 20 years. You're also going to be hard pressed to find any economists that will argue that population growth and cost of living are better indicators of a state's "fortunes" than per capita GDP (see India with tons of population growth and a very low cost of living as one example to support this point).

I do, however, think you make an interesting point by bringing cost of living into the equation with regard to per capita GDP, but I think you're missing a crucial part of the analysis. The greater amount of money spent on cost of living in Massachusetts doesn't happen in a vacuum and it doesn't just disappear - that money is reinvested back into the state and the people who live there.  Just for a few examples, I did a quick google search about state rankings in terms of education, healthcare outcomes, and poverty: According to the first sources that popped up (so correct me if you can find better data of course) but it looks like Massachusetts is ranked 1st in education, 2nd in healthcare outcomes, and 10th in poverty. Texas, on the other hand, is ranked 34th in education, 42nd in healthcare outcomes, and 41st in poverty. 

I would argue that Massachusetts is getting a pretty good ROI on the cost of living and that having a better educated, healthier, and less financially strained population is what's driving Massachusetts' faster per capita GDP growth relative to Texas, but even if you look at Massachusetts' public spending as nothing but an anchor that isn't driving growth, then it's even more impressive that Massachusetts is able to achieve a faster per capita GDP growth rate despite the larger cost of living.

10 hours ago, dragonfly said:

If you drill down that means that cab drivers in NYC produce twice as much as their Houston counterparts, teachers produce twice as much, police officers produce twice as much, as do  auto mechanics, etc etc. Is this really the case? Do auto mechanics in NYC fix twice as many vehicles as the ones in Houston? Do average passenger miles driven by cab drivers in NYC equal twice those in Houston? Of course not. 

I also wanted to point out that what you've written here about NYC vs Houston teachers/cab drivers, etc. is a fundamental misunderstanding of how per capita GDP works, just as an FYI.  Per capita GDP doesn't indicate that teachers or cabbies in one area are doing more work or producing more value than teachers or cabbies in another area - it means that there's so much value being created in one area relative to another that when said value is divided across the entire population that there's a notable difference. The work of teachers and cab drivers and other professions that are more consistent across areas with different cost of living actually reduce per capita GDP discrepancies to make them more consistent, whereas the other professions with less consistency across areas with different costs of living are what's driving those discrepancies apart. 

 

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3 hours ago, ruraljuror said:

I would argue that Massachusetts is getting a pretty good ROI on the cost of living and that having a better educated, healthier, and less financially strained population is what's driving Massachusetts' faster per capita GDP growth relative to Texas, but even if you look at Massachusetts' public spending as nothing but an anchor that isn't driving growth, then it's even more impressive that Massachusetts is able to achieve a faster per capita GDP growth rate despite the larger cost of living.

I also wanted to point out that what you've written here about NYC vs Houston teachers/cab drivers, etc. is a fundamental misunderstanding of how per capita GDP works, just as an FYI.  Per capita GDP doesn't indicate that teachers or cabbies in one area are doing more work or producing more value than teachers or cabbies in another area - it means that there's so much value being created in one area relative to another that when said value is divided across the entire population that there's a notable difference. The work of teachers and cab drivers and other professions that are more consistent across areas with different cost of living actually reduce per capita GDP discrepancies to make them more consistent, whereas the other professions with less consistency across areas with different costs of living are what's driving those discrepancies apart. 

OK so let's look at a little logic here. Population of Texas is exploding and the consequent job creation blows Mass out of the water. If the MA worker is creating so much value for the US economy, why can't that state blow away both TN and TX in job creation per capita when obviously it doesn't? It doesn't because raw GDP per capita like I said before, can generate nonsense, unless it is combined with the COL and maybe other factors.

Also, yes auto mechanics in NYC are likely not making 2x the money of ones in Houston, but they certainly make significantly more without fixing more vehicles, so to say that their marginal contribution to the state GDP is less than NYC  investment bankers misses MY point and saying I misunderstand all this is a bogus point, because my point was to introduce some sarcasm into the argument. For a little entertainment if nobody minds.

Also given per capita GDP of MA say is growing faster than Texas. So is the COL. I tried to find a COL trend table for the states and couldn't come up with it but suppose the COL increases in MA are trending upward much faster than the other two states, say enough to more than negate the increase in per capita GDP then where are we? I don't have the numbers.

So why don't I do this to further illustrate the possible absurdities of raw GDP numbers and their purported explanatory powers. Let's compare Hawaii and TN and their numbers from the table I linked above. Does the average Hawaii resident actually contribute $55,169 to the U.S. economy with the TN resident contributing much less at $46,858? Really, I mean a state with virtually zero manufacturing, contributes 20% more per capita to the U.S. economy than residents of a much larger state with several auto plants and numerous other industrial facilities? I don't think so. This comes back to my 'nonsense' explanation. You could say well, Hawaii has tourism, but then so does TN.

Let's look at another example with a different angle, at my locality and a well-known brand. The company Igloo is based here and had a suburban plant at the intersection of the state's biggest road, Katy Fwy (I-10) and Beltway 8, a toll road. They closed the plant, sold it and built a gigantic facility further west, literally in the country near Brookshire. So their real estate tax went way down, and they acquired so much space that they could build all manner of efficiencies into the facility that they didn't have before. Assume a high price for the sold land more than paid for the much larger parcel. Let's even presume that the COL in Brookshire is so much lower than in Houston/burbs, that new hires will work for a bit less while having a higher living standard than their Houston co-workers. As a result of all the previous, Igloo can sell their products for a bit less (adjusted for inflation) than before. Maybe people even come from out of state to work there and live in Brookshire as per job creation. Can anyone really maintain that the per capita product (in dollars) of this workforce, which went down because of this move really caused Texas to contribute less to the U.S. economy? With the company selling products nationwide for a bit cheaper? I think that argument would be absurd on the face of it. This would indicate that products made in lower COL states are made more efficiently than they can be made in higher COL states which is opposite to the argument in the WSJ article. Economics has never been straightforward.

Edited by dragonfly
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55 minutes ago, dragonfly said:

OK so let's look at a little logic here. Population of Texas is exploding and the consequent job creation blows Mass out of the water. If the MA worker is creating so much value for the US economy, why can't that state blow away both TN and TX in job creation per capita when obviously it doesn't? It doesn't because raw GDP per capita like I said before, can generate nonsense, unless it is combined with the COL and maybe other factors.

Also, yes auto mechanics in NYC are likely not making 2x the money of ones in Houston, but they certainly make significantly more without fixing more vehicles, so to say that their marginal contribution to the state GDP is less than NYC  investment bankers misses MY point and saying I misunderstand all this is a bogus point, because my point was to introduce some sarcasm into the argument. For a little entertainment if nobody minds.

Also given per capita GDP of MA say is growing faster than Texas. So is the COL. I tried to find a COL trend table for the states and couldn't come up with it but suppose the COL increases in MA are trending upward much faster than the other two states, say enough to more than negate the increase in per capita GDP then where are we? I don't have the numbers.

So why don't I do this to further illustrate the possible absurdities of raw GDP numbers and their purported explanatory powers. Let's compare Hawaii and TN and their numbers from the table I linked above. Does the average Hawaii resident actually contribute $55,169 to the U.S. economy with the TN resident contributing much less at $46,858? Really, I mean a state with virtually zero manufacturing, contributes 20% more per capita to the U.S. economy than residents of a much larger state with several auto plants and numerous other industrial facilities? I don't think so. This comes back to my 'nonsense' explanation. You could say well, Hawaii has tourism, but then so does TN.

Let's look at another example with a different angle, at my locality and a well-known brand. The company Igloo is based here and had a suburban plant at the intersection of the state's biggest road, Katy Fwy (I-10) and Beltway 8, a toll road. They closed the plant, sold it and built a gigantic facility further west, literally in the country near Brookshire. So their real estate tax went way down, and they acquired so much space that they could build all manner of efficiencies into the facility that they didn't have before. Assume a high price for the sold land more than paid for the much larger parcel. Let's even presume that the COL in Brookshire is so much lower than in Houston/burbs, that new hires will work for a bit less while having a higher living standard than their Houston co-workers. As a result, Igloo can sell their products for a bit less than before. Maybe people even come from out of state to work there and live in Brookshire as per job creation. Can anyone really maintain that the per capita product (in dollars) of this workforce, which went down because of this move really caused Texas to contribute less to the U.S. economy? With the company selling products nationwide for a bit cheaper? I think that argument would be absurd on the face of it. This would indicate that products made in lower COL states are made more efficiently than they can be made in higher COL states which is opposite to the argument in the WSJ article.

Regardless what you think about the value of GDP as a metric, you're still not addressing the growth rates. As an olive branch, I will grant you that Texas per capita GDP growth has improved over the last 5 years at about 3% slower than Massachusetts - down from about 4% slower than Massachusetts over the last two decades, so the growth rate gap is narrowing. That said, it's not as though Texas is catching up, it's just losing ground less slowly than it was earlier in the millennium.

You are right, however, that this analysis could be impacted if cost of living in Massachusetts were climbing significantly faster than in Texas, but I'm curious what makes you think that's the case. Do you believe the population growth that you're touting as a measure of success is bringing costs down somehow? Correct me if I'm missing something, but the law of supply and demand would seem to indicate otherwise, which may be the reason you're having trouble finding the numbers you're looking for. I know cost of living in Nashville has been pretty steep of late at least and we're much closer to the TX than the MA tract. 

I'll also note that you're correct that I totally missed your joke in the previous post, which is my bad, but I do still think you're missing the larger point with your mechanic and igloo comparisons, and the source of the confusion again seems to be supply and demand. A mechanic can charge more for fixing your car in the middle of a city than they can charge for fixing a similar car out in the boondocks because there are lots of customers in the city and transporting their cars out to the boondocks costs time and money for which the city mechanic is able to charge a premium. The market dictates the value, not the mechanic.

In your igloo example, however, I would argue (and the market would agree) that the value created by the relocated work force as you describe it did indeed cause Texas to contribute less to the economy unless they're selling more units as a result. By selling their product for less, they should be able to move more product and net additional revenue, otherwise the relocation was a bad business decision. If Igloo lowers its price and is unable to move any additional units to make up for the reduced revenue, however, then you are correct that Texas would then in fact be contributing less to the US economy. Even if they move the exact same number of units pre and post relocation, the lower prices (with no additional sales) indicate that the market values the product less after than before the move, which is then fairly reflected in GDP.

I'm genuinely curious, does that argument still seem absurd to you after having read this explanation? 

 

Edited by ruraljuror
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