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Comments on: Quakes aren’t good for the economy http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/ The Visible Hand in Economics Tue, 28 Sep 2010 14:29:15 +0000 hourly 1 https://wordpress.org/?v=6.9.4 By: Carl http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-30871 Tue, 28 Sep 2010 14:29:15 +0000 http://www.tvhe.co.nz/?p=5368#comment-30871 This is Obamanomics. Imagine all the people that’ll be put back to word rebuilding the city. It’s a great argument for nuclear war 🙂

]]> By: THaNGa http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-30867 Tue, 28 Sep 2010 13:39:00 +0000 http://www.tvhe.co.nz/?p=5368#comment-30867 There are 25 Irish Tourist Board approved Dingle B&Bs scattered in the town and all over the peninsula. If you want to experience peace and tranquillity in a scenic area then choose Dingle Bed and breakfasts dotted around the peninsula. refinance mortgageIf you want to head out in Dingle town and make the most of its legendary nightlife then book a bed and breakfast in Dingle town.

]]> By: Latest Roofing Estimates Auctions | Roofing Spartanburg SC http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-30421 Wed, 08 Sep 2010 17:04:52 +0000 http://www.tvhe.co.nz/?p=5368#comment-30421 […] TVHE » Quakes aren't good for the economy […]

]]> By: Miguel Sanchez http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-30079 Tue, 07 Sep 2010 21:21:27 +0000 http://www.tvhe.co.nz/?p=5368#comment-30079 Abstracting away from the quake might make it a bit easier to understand. The national accounts aren’t measured in the same way that a company’s accounts would be – they don’t factor in the regular depreciation of assets. A lot of what goes into GDP – repair and replacement of housing, machinery, durable goods etc – really amounts to running just to stand still. It’s only “good for the economy” in the sense that if we didn’t do it, our wealth would decline. Or more accurately, as Phil said, it would fall below what has been shown to be our preferred level.

]]> By: Miguel Sanchez http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-30065 Tue, 07 Sep 2010 21:03:28 +0000 http://www.tvhe.co.nz/?p=5368#comment-30065 ianr: that’s just another example of how the earthquake will boost measured GDP without actually benefiting the economy. Even if overseas insurers covered 100% of the cost of rebuilding, it doesn’t change the fact that the economy would have been at least as well off if the quake had never happened.

]]> By: ianr http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-29099 Tue, 07 Sep 2010 02:24:09 +0000 http://www.tvhe.co.nz/?p=5368#comment-29099 A key point here is that the insurance industry is largely off-shore. Effectively we will be getting back some of the invisibles we have been importing for a period. Assuming that the insurance companies are underwritten by lloyds in london – the earthquake is an export industry

]]> By: hagrid han http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-29035 Tue, 07 Sep 2010 01:22:18 +0000 http://www.tvhe.co.nz/?p=5368#comment-29035 Well,earthquake bring the economy up?Or,rephrase that,just say the war bring the economy up.The first world war,and the second world war,do them really bring the economy up?
No,I don’t think so,it’s just balance the world.But,it improve the technology,right?Whatever,the earthquake bring the economy up just like we destroy a thing,then make a new thing or more creative things out.

]]> By: JiveKitty http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-28988 Tue, 07 Sep 2010 00:02:41 +0000 http://www.tvhe.co.nz/?p=5368#comment-28988 Yip, and many of these buildings, etc, still likely had significant productive value.

]]> By: Kimble http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-28945 Mon, 06 Sep 2010 23:17:48 +0000 http://www.tvhe.co.nz/?p=5368#comment-28945 Even the GDP growth is likely to simply bring forward production that would have occured anyway. All those buildings would have been replaced at some point in time in the future.

]]> By: Matt Nolan http://www.tvhe.co.nz/2010/09/06/quakes-arent-good-for-the-economy-2/#comment-28860 Mon, 06 Sep 2010 22:13:46 +0000 http://www.tvhe.co.nz/?p=5368#comment-28860 @Phil Sage (sagenz)

Hi Phil,

Just checking you read my post, it went like:

1) GDP growth will be higher, because there are investment opportunities available now
2) However, they are only available because the capital was destroyed – so we are doing something costly to try and get back where we are,
3) As a result, this higher GDP growth stemming from an earthquake isn’t “good for the economy” like the headline said – and this isn’t what the economists were saying.

The headline was “quake could be good for the economy” – this was wrong. I don’t know what Not PC said about GDP growth – I explicitly said it would be higher in my post. My post was against the idea that the earthquake was GOOD for the economy – which is highly unlikely.

@MarkS

If the premiums were set on the idea that there was a given probability of an earthquake this will all just wash out right – there will be some funds turning up now, but the premiums through time will more than pay for that. So I’m not sure I’d really use that as a “good for the economy” type argument either.

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