New Zealanders are known for being understated. Australians do not know the meaning of understated.
As they are wealthier than us, we expect and endure their boorish taunts.
Turns out the Australians are not as rich as they think.
Reserve Bank Governor Alan Bollard recently outlined why he thinks that our Australian cousins are not as rich as they claim to be, and it has to do with marijuana.
You see, Australian statisticians consider Schapelle Corby an exporter, whereas ours ignore her kind entirely.
Corby and her ilk live in what is politely called the "unobserved economy".
Drug dealers, sex workers and loan sharks all provide goods and services, yet prefer not to complete compliance forms sent to measure economic output.
To compensate, Australia adds 1.3 per cent to their gross domestic product for the underground economy, and another 2 per cent for those who grow their own veges.
We prefer not to dignify such nonsense with inclusion in the national accounts.
Neither do the Japanese, perhaps because they run out of fingers trying to tabulate the final figure. Every other OECD nation makes this provision.
The same applies to financial services. GDP is defined as the value of completed goods and services. The final price of the restaurant meal is counted, what the restaurant spent on carrots and flour is not.
When it comes to the financial sector, New Zealand considers the margin made by banks and others to be part of the cost of business. The Australians do not. This, Bollard seems to politely infer, is double counting, and is worth a significant 2 per cent of GDP.
The good doctor then points to the housing sector, a recurring fascination for Reserve Bank governors. If the property is rented, the rent is counted. If it is owner-occupied, the rent is imputed.
The Australians assume that their houses get better over time and re-value their housing stock. Again, we prefer not to engage in such puffery. A house is a house. If you add pink batts then the value of the pink batts is measured. No need to give the council cause to up the rates. Chalk up another 1.5 per cent GDP to the Australians.
Finally, the Australians treat research and development as an end product, which they count in their GDP figures. We treat it as a cost of business and do not. This piece of financial underarm is worth a huge 3 per cent to their GDP compared with our own.
Bollard believes we are understating our GDP by 10 per cent relative to how the Australians would measure the same output. He points to purchasing power comparisons that show Australians have 20 per cent more spending power than we do, not the 30 per cent that they should have using their figures.
Australians. Seems they pad more than their bras and budgie smugglers.