A Closer Look At California’s Economy
What makes California’s GDP so vast and their economy so powerful?
Relative population is a big factor, as the state is the most populous in the U.S. with roughly 12% of the country’s population calling it home.
But since California’s GDP makes up over 15% of the country’s economic output, there must be something else at work.
One key driver is the technology sector. Not only does Silicon Valley generate massive amounts of technological output, this also translates directly to wealth and economic activity.
Many tech markets follow winner-take-all dynamics, bringing large revenues back to the state. In addition, smaller technology companies are frequently gobbled up by larger competitors, adding wealth back into the mix through M&A.