>"it’s impossible for anyone to spend more on imports without also spending more on something else"
That of course assumes total spending is fixed. So "if imports (outflow spending for the domestic sector) did/do increase, what other, domestic spending measure (which causes domestic production) did/will increase to compensate and keep 'GDP' the same?" A sticky conceptual wicket.
I know I don't have to tell you BTW that the fixed-GDP assumption is anathema in the far-too-widespread causal misconception: "If there's more consumption spending, there will be less investment spending. It's an accounting identity!"
Just curious, in the scatterplot what quarters are the three dots on the right (especially the bottom one)?
Also my eyeball-regression trendline suggests that higher GDP growth 𝜚 weaker imports and v-v. Which is arithmetically obvious cuz imports, conceptually, "substitute for domestic production that woulda shoulda coulda happened otherwise, absent the imports." 🙄 As u say, mebbe long-term but certainly not in GDPNow.
Remember, imports are a negative contribution to GDP. So a low value on the Y axis is high growth in imports. The dominant relationship here is from high GDP growth to high import growth. Not from high import growth to slower GDP growth. This is something a lot of people get confused about.
The three points on the right are the first three quarters of 1950.
>"it’s impossible for anyone to spend more on imports without also spending more on something else"
That of course assumes total spending is fixed. So "if imports (outflow spending for the domestic sector) did/do increase, what other, domestic spending measure (which causes domestic production) did/will increase to compensate and keep 'GDP' the same?" A sticky conceptual wicket.
I know I don't have to tell you BTW that the fixed-GDP assumption is anathema in the far-too-widespread causal misconception: "If there's more consumption spending, there will be less investment spending. It's an accounting identity!"
Just curious, in the scatterplot what quarters are the three dots on the right (especially the bottom one)?
Also my eyeball-regression trendline suggests that higher GDP growth 𝜚 weaker imports and v-v. Which is arithmetically obvious cuz imports, conceptually, "substitute for domestic production that woulda shoulda coulda happened otherwise, absent the imports." 🙄 As u say, mebbe long-term but certainly not in GDPNow.
Remember, imports are a negative contribution to GDP. So a low value on the Y axis is high growth in imports. The dominant relationship here is from high GDP growth to high import growth. Not from high import growth to slower GDP growth. This is something a lot of people get confused about.
The three points on the right are the first three quarters of 1950.
Ah right thanks, I wasn't mentally translating Contribution of Imports axis label to Drag on GDP Measure. Got it.