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17 April 2012


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Angus McLellan

Could I make a request for the benefit of us non-economists? Could you maybe do an idiot's guide to GDP/GNP/GVA and other widely quoted indicators? Wikipedia's coverage leaves me less than certain of the differences.

I have a second question. When I was a lad the trade deficit was reported in hushed tones every month, followed by a talking head explaining why it had gone up or done and why this mattered or didn't matter. If I try to place its disappearance, it seemed to come long after the end of exchange controls. So, why isn't the UK's trade balance as newsworthy as it once was and would that still be true of an independent Scotland?

Saor Alba

O/T but you describe yourself in your bio as a "regional economist" yet then go on to talk a lot about Scottish this and Scottish that! I would have expected a man in your position and with your background to have been aware of the basic fact,that even my 5 year old grandson knows,that SCOTLAND IS A NATION NOT A REGION,no matter how much you unionist establishment lackeys would like it to be otherwise! In response to this article I can only assume you're gagging for some kind of dubious honour from your masters in Westminster!

Saor Alba

Another point that I found rather amusing was that an obvious unionist mouthpiece like yourself has the audacity to accuse the Scottish Government of spin! Pots and kettles spring to mind!

George Bunbury

Dear Saor Alba

Is it possible that a Cybernat like yourself could just for once not make a fool of yourself on a blog like this?

Brian's position seems to me that he is prepared to look for evidence before taking a position on whether or not he comes out in support of independence. This seems perfectly fair and sensible. If you resort to screaming abuse at economists like Brian Ashcroft, who are respected by all sides, then you do your own cause more harm than good.

Angus McLellan

If I can add to my questions, according to Wikipedia's collection of GDP and GNI figures, Ireland and Iceland seemed to be visibly outliers in terms of the ratio of GNI to GDP (using the World Bank's numbers) being in the c. 85% range. I picked another four countries - Netherlands and UK which I expected to show higher GNI than GDP and Australia and NZ which I thought might show the opposite. But I was suprised. The ratios there were quite tightly clustered, from 98% for NZ to 106% for UK.

So my question is this. Why should we expect the Scottish ratio to resemble Ireland or Iceland more than, say, Australia or New Zealand? Do we have evidence to support that or is it just a(n educated) guess?

Brian Ashcroft

GNP < GDP in Scotland because of the large number of multinationals operating in Scotland and the high level of external ownership and control of the oil industry. We are much more similar to Ireland than Australia or New Zealand I believe.

Angus McLellan

Many thanks for taking the time to reply. I'll take shameless advantage of your good nature and try for one more question.

If I had deep pockets and a team of highly skilled economists, statisticians and researchers on hand to answer to my every whim, are the data sources needed for them to calculate a GNP or GNI for Scotland available in the public domain?

I assume the answer is no, not because we lack statistically plausible data for foreign ownership but because we can make no estimates of Scottish ownership of foreign assets. (For example, I own a share in extractive industries around the world via my investments, but what my pension fund owns on my behalf is a bit of a mystery.) But perhaps I am wrong?

Brian Ashcroft

Yes, it is not easy but in principle it is doable but costly. One problem, is charting flows of income between Scotland and rest of UK, the other is disentangling flows to and from Scottish residents via the data held by the UK tax authorities, which may not make location sufficiently clear. These problems would be less the more Scotland had independent tax and revenue collection institutions and national accounts. I am not arguing for independence here! The Scottish Executive statisticians looked at the possibility of calculating a GNP statistics and concluded that the benefit - and dubious accuracy - wasn't worth the cost. I didn't agree with them.

Angus McLellan

Thanks for that clear and concise answer. It makes the next step clear too: write to my MSP! Thanks again.

Frank MacDonald


There was a great deal of anemic critique and very little acknowledgement of what the Scottish Government has already done and is continuing to do with regard to securing inward investment. Although you utilise a pragmatic tone, I fear there's a hint of bias in either the analysis or the presentation. To be honest, I'm disappointed that a man of your experience would neglect the importance of a balanced article.

Iain Gunn

Let's look at it this way, for comparative study: should New Zealand and Australia join as a union? Would New Zealand be better off? What factors would be involved that would make this a bumpy ride?

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