{"id":394,"date":"2005-10-26T17:01:35","date_gmt":"2005-10-26T11:31:35","guid":{"rendered":"http:\/\/www.ravikiran.com\/2005\/10\/26\/i-make-a-mistake-i-get-caught\/"},"modified":"2005-10-26T17:01:35","modified_gmt":"2005-10-26T11:31:35","slug":"i-make-a-mistake-i-get-caught","status":"publish","type":"post","link":"https:\/\/www.ravikiran.com\/blog\/classic\/200510\/i-make-a-mistake-i-get-caught\/","title":{"rendered":"I make a mistake! I get caught!"},"content":{"rendered":"<p>This is really embarrassing. It turns out that <a href=\"http:\/\/www.ravikiran.com\/2005\/10\/25\/answer-its-the-growth-rate\/\">my argument<\/a> about  investment leading to an increase in GDP comes from a simple ignorance of mathematics. <a href=\"http:\/\/free-blog-site.com\/navin\/archive\/2005\/10\/25\/84954.aspx\">Navin<\/a> clearly points this out for me. <\/p>\n<blockquote><p>1. GDP = consumption + investment + exports &#8211; imports <\/p>\n<p>This clearly shows a GDP can grow even without investments when other factors help.  Currently, America&#8217;s savings rate is below 0% (hence no investments as per ravi), so the GDP growth is also not there ? Indeed, its there,a good 3.3% !! This example makes it clear that ravi&#8217;s statement is a bit off ( I wouldn&#8217;t say wrong. That would be rude ;-))<\/p><\/blockquote>\n<p>How silly of me to forget this equation!  As you can clearly see, raising investment on the Right Hand Side will of course raise the GDP on the Left Hand Side, but the same can be achieved by increasing consumption! So all that I have to do is to increase the consumption and GDP increases! So  it was just silly of me not to know of this basic mathematical fact. So to put it very simply, if I consume 1 pane of glass for my window this year, I just need to place another order for 1.5 panes of glass for my bigger window next year, and hey presto! the GDP will grow by (0.5 panes)* (price of 0.5 panes of glass).<br \/>\n<!--more--><br \/>\nJust one question. Where will that extra half a pane of glass come from?<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This is really embarrassing. It turns out that my argument about investment leading to an increase in GDP comes from a simple ignorance of mathematics. Navin clearly points this out for me. 1. GDP = consumption + investment + exports &#8211; imports This clearly shows a GDP can grow even without investments when other factors [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[],"_links":{"self":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/posts\/394"}],"collection":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/comments?post=394"}],"version-history":[{"count":0,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/posts\/394\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/media?parent=394"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/categories?post=394"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/tags?post=394"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}