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This paper makes use of both output and income statistics derived from the System of National Accounts to examine performance in the three North American countries. In doing so, the paper follows recommendations contained in the System of National Accounts 1993 (SNA 1993) for calculating aggregate real income statistics such as gross national income (GNI) and gross national disposable income (GNDI) rather than aggregate real gross domestic product (GDP), in order to demonstrate the utility of alternate measures for analyzing aggregate economic performance and the standard of living.

The paper uses Organization for Economic Co-operation and Development (OECD) data to compare commonly employed metrics like labour productivity and real GDP per capita with real income measures that some may argue are more closely associated with well-being. Specifically, the SNA 1993 metrics of real gross domestic income (GDI) per capita, real GNI per capita, and real GNDI per capita are examined. The real income metrics include adjustments for relative prices of traded goods and current account transactions outside of the trade balance. The latter are income flows for primary incomes associated with production across jurisdictional boundaries and for international income transfers.

The comparison of the real income metrics with more traditionally examined real GDP per capita and/or labour productivity shows that conclusions about the relative performance of these three North American economies are sensitive to the measures adopted:

  1. Economic downturns and recoveries can be more pronounced than real GDP metrics imply. For example, in Mexico, the 1984 balance-of-payments crisis led to an average annual reduction of real GDP per capita of 1.3% between 1981 and 1986. Real GNDI per capita, which incorporates terms-of-trade changes and income flows in the balance of payments, declined at an average annual rate of 2.9%, a rate more than twice that for real GDP per capita. During the subsequent recovery in Mexico, between 1987 and 1990, real GDP per capita grew at an average annual rate of 0.4%, while real GNDI per capita grew at 1.3%.
  2. Perceptions about the progress of nations can be affected by the metric employed. After 2000, Canada's labour productivity growth lagged that of the United States, while real GDP per capita progressed at about the same rate in the two countries. On the basis of GNDI per capita, Canadian real income grew significantly faster than real income in the United States over this period.
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