In a special report on managing information, the Economist writes that Wal-Mart’s “revenue last year, around $400 billion, is more than the GDP of many entire countries.”
This is an apples-to-oranges comparison that means nothing. GDP measures value-added. Revenue measures gross value. Please never print such a comparison again.
Martin Wolf tackled this in a FT column in 2002. Jagdish Bhagwati took it on in In Defense of Globalization in 2004. And Paul De Grauwe and Filip Camerman even devoted 15 pages to measuring the size of companies correctly. Yet this “elementary howler” keeps rearing its head, time after time.
Addendum (22 March): My very brief letter to the Economist on this point appeared online.