Felix Salmon has an interesting post on the differences between Ontario and New York state:
So if you simply use exchange rates rather than PPP, suddenly Ontario looks much better off, with GDP per capita of $54,700 — above, rather than below, the median level of its North American peers.
And if you look at other metrics, those of us who live in New York should probably take relatively little pride in our status atop the GDP-per-capita stakes.
Felix then shares a chart from Nick Rizzo tracking median household income in Ontario vs. New York state. While the median household in Ontario earned $62,113 in 2009, the median household in New York state earned $54,659. Felix goes on to make a number of other claims:
And of course in lots of other metrics, too, like health outcomes, or the poverty rate, or just general quality of life, Ontario manages to handily beat New York state. GDP masks more than it reveals, much of the time; New York state’s high GDP Is largely a function of the financial industry, and that in turn only serves to make life much more expensive for the overwhelming majority of New York City’s population which does.
We’ll bracket those questions for the moment. What I’d like to know is whether we’re comparing like households. The average number of persons per household in Ontario is 2.6, which is very close to the 2.64 in New York state.
As of 2006, married-couple households constitute 73.9 percent of all family households in Ontario. As of 2010, married-couple households are roughly 69 percent of all family households in New York state. About 35.6 percent of households in New York state are non-family households. If I understand correctly, the share of non-family households as a proportion of the total number of private households in Ontario is 24.8 percent. A large share of non-family households consist of unmarried adults living alone. I should stress that I made these calculations on the fly, and it is entirely possible that I’ve missed something significant, so please tell me if I have.
If New York state has a higher proportion of unmarried adults living alone than Ontario, which seems plausible, and if married-couple households represent a somewhat higher proportion of all households in Ontario than in New York state, which also seems plausible, should we be surprised that the median household income would be higher in Ontario than in New York state?
It is also worth noting that the United States and Canada have very different immigration policies. Canada places a much stronger emphasis on attracting skilled migrants than the U.S., which tends to emphasize family reunification, the diversity visa lottery, etc.
Felix ends his post with the following observation:
I ended my talk by asking the crowd to engage in a classic philosophical thought experiment. I’ll give you a choice, the day before you’re born. You can either be born to a randomly-chosen mother in Ontario, or else you can be born to a randomly-chosen mother in New York state. Which do you choose? For me, and for most of the audience, the choice was clear: Ontario. Its PPP-adjust GDP per capita notwithstanding.
I’ll give you a choice, the day before you’re born. You can either be born to a randomly-chosen mother in a place where families are intact, or else you can be born to a randomly-chosen mother in a place where families are much less likely to remain intact due to a complex, interrelated set of factors, many of them related to the particular historical challenges facing a post-slavery society. Which do you choose?
While I realize that many people would choose the former, I’d argue that the question isn’t actually a very meaningful one. We in the United States can’t choose to go back in time and erase the stain of slavery and segregation from our past. What we can at least try to do is work constructively towards giving all Americans better life prospects. I would argue that reforming our criminal justice system and reforming our public sector so that we can more effectively deploy human resources should be our most urgent priorities. Others would argue that embracing social democracy, i.e., much higher taxes and much higher levels of public spending, should be our most urgent priority instead. But regardless of how we answer the question, I think we can all agree that Canadian public policy would look rather different if Canada were dealing with the same historical legacy.