Why can a New Jersey commuter’s wages relate to GDP generated outside New Jersey? » Graduate U.S. Economy MCQ » MCQ Academy

U.S. Economy

Why can a New Jersey commuter’s wages relate to GDP generated outside New Jersey?

Cross-state earnings are allocated to the worker’s place of residence in GDP
The person may work and produce output in another state
State GDP adds all commuting costs to output in the origin state
Regional GDP assigns production according to homeownership rather than workplace

Cross-state earnings are allocated to the worker's place of residence in GDP
The person may work and produce output in another state
State GDP adds all commuting costs to output in the origin state
Regional GDP assigns production according to homeownership rather than workplace

Note

New Jersey residents employed across state lines can receive earnings connected to economic output outside New Jersey.

A New Jersey resident can commute into New York or Pennsylvania for work. The person's wages may help support a New Jersey household while the associated workplace output contributes to another state's GDP. Cross-border commuters demonstrate why income received by residents and production within borders are different concepts.

Tags: Economic Research Methods, New Jersey Facts

Note

Leave a Reply Cancel reply