Benchmark
Profits Stashed in the Caribbean Are Messing With U.S. Economic Data
Profit-shifting shaves billions dollars off of U.S. output data, altering productivity figures
Turks And Caicos Islands, Providenciales, on Sept. 25, 2016.
Photographer: Dimitrios Kambouris/Getty Images for Beaches Turks & CaicosThis article is for subscribers only.
Companies shifting their profits to the Netherlands or Turks and Caicos probably have taxes in mind. But the consequences are felt well beyond the Internal Revenue Service ledger: growth and productivity also lose some upside.
Researchers have added back in shifted earnings to figure out how the increased offshore recognition has affected U.S. economic data, and theirs is the first study in this week's economic research roundup. We also take a look at Chinese growth estimation, automation-born job loss and the distributional effects of longer life expectancy. Check this column each week for new and interesting studies from around the world.