[mike_hearn]

It's a common meme. The entire financial industry is only about 11% of the GDP (or around 7% if you use a different statistical method). That includes insurance, pensions, etc.

The idea that Switzerland is propped up by tax evasion simply isn't true. The UK thought it was true and actually wrote proceeds from better Swiss cooperation over banking records into their budget .... then discovered there was a huge shortfall, because there was much less evasion done that way than they had imagined.

[hollerith]

OK, but if a larger percentage of Swiss residents emigrated there for the favorable tax laws than emigrated to the US for the same reason, that could inflate Swiss GDP, i.e., make the Swiss per-capita GDP an overly optimistic measure of what life is like for Swiss residents who haven't acquired wealth outside Switzerland.

[mike_hearn]

GDP is not a measure of the static wealth of the citizens of a country, it's a measure of economic activity (literally adding it all up).

[hollerith]

OK, but if someone who made a fortune in Germany moves to Switzerland and buys a Mercedes, does that not add about $50 K to Swiss GDP? The reasons I suspect it might are (1) GDP is essentially a measure of economic activity, i.e., transactions, and (2) how all of the small tax shelters, Monaco, Lichtenstein, etc, have very high per-capita GDP.

Regarding (1), it is possible that living in a tax shelter gives residents without a fortune more opportunities to make money than living in a country like Germany or the US does, but I lean towards the possibility that per-capita GDP is simply inaccurate or flawed as measure of the economic prospects of the residents who don't have fortunes.

Also, Singapore's per-capita GDP is very high compared to the personal income of its human residents (I have read) and I figure that was because a large fraction of Singapore's businesses are owned by non-Singaporeans (which has been the case, BTW, since Singapore's founding by British trading interests).