The professor from whom I learned the most in college used to tell us that economics is a mixture of little science, a fair amount of technique, and a lot of ideology. I would add that ideology, especially, abounds in public debate, albeit disguised as science, given that scientific and technical debate remains within the academic world. We have good examples in recent economic debates: the debate on the regional financing model and the debate on the impact of immigration.
I will focus on this second debate, continuing from some previous articles on the welfare state and immigration, where, to summarize, I argued that the fact that immigrants may contribute less in taxes than they ultimately receive is something they have in common with most of the population. In fact, it's something they share with the entire population whose work and consumption allow a minority to take more from the market than anyone else, and who, thanks to this, end up contributing more to the tax system than they receive.
But those who see immigration as posing many economic threats keep adding arguments to their criticism. Among the most recent, the one that takes the evolution of GDP per capita in the different autonomous communities They point out that the regions with the highest growth have the lowest immigration; therefore, they infer that low immigration has made them richer, while it has impoverished the communities with higher immigration—except for Madrid, which has high immigration and a strong increase in GDP per capita, for reasons that are not explained.
However, the truth is that the increase in GDP per capita in low-immigration communities is basically due to a decrease in the denominator, that is, in the population. Especially the younger population: those who do not contribute to the numerator of the indicator in question, but do contribute to the denominator. In the case of Extremadura, the region where GDP per capita has grown the most this century, the population under 16 years of age has decreased by 27%, both in relative and absolute terms! (For comparison, in Catalonia it has remained stable in relative terms and increased in absolute numbers.)
A phenomenon that, in the short term and in purely statistical terms, represents an increase in the GDP/population ratio, which alone explains all the apparent growth in GDP per capita of that autonomous community. Therefore, celebrating the economic evolution of a community experiencing population decline is a similar absurdity to congratulating a couple who cannot have children, even though they desire them, because this way their per capita income is higher.
GDP per capita can be a better indicator of the economic evolution of a territory than simple GDP growth, but it cannot be used directly to compare divergent economic realities and trajectories. And that includes the Community of Madrid, with a GDP per capita increasingly inflated by the effect"switch"; that is, due to the progressive increase in the multitude of people who work but do not reside there, and who, therefore, increase the numerator without being in the denominator.
