Media Release – GDP per person falls in every state

5 March 2009

Media Releases 2009

‘Most economic commentators assume that changes in GDP are proxy measures for changes in human welfare,’ says Dr Coulter. ‘Accepting for the moment that this is the case, then change in GDP per person, rather than gross GDP, is actually a better measure of welfare.

‘If we look at per capita rather than gross GDP, then all states show negative growth for the December quarter.’

Dr Coulter notes that Tasmania, with the lowest rate of population growth, showed the least negative economic growth with only a 0.1% fall per capita. Western Australia, which had the highest rate of population growth, shows the second largest fall in per capita GDP at almost 2%.

‘Queensland is in a similar position,’ he says, ‘sharing with the Northern Territory the second highest rate of population growth but having the third largest fall in per capita GDP. South Australia has the biggest drop in GDP, a high rate of population growth relative to the economy and the largest decline in per capita GDP at 2.5%.’

Dr Coulter says the figures indicate no economic or welfare advantage from a growing population.

‘They confirm calculations I have made over many years comparing OECD countries. These calculations repeatedly show no statistically significant correlation between population growth and growth of per capita GDP. They parallel the conclusion of the Productivity Commission report which showed that, despite excluding many of the environmental costs of a larger population, there was no demonstrable link between increase in immigration and per capita economic growth.’

With respect to tackling climate change, Dr Coulter notes that the Rudd Government clearly accepts that there are considerable environmental costs from a growing population.

‘In fact, there are a host of other environmental costs from population growth,’ he says.

‘It is long past the time for all Australian Governments to adopt population policies aimed at environmental sustainability, rather than the mirage of economic and welfare benefits from a growing population.’

For further comment or information:
Dr John Coulter 08/8388 2153


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