In the seven years between 2016 and 2022, US GDP per capita and US pet industry spending tracked each other so precisely that one begins to suspect the Federal Reserve is secretly setting monetary policy to optimize for dog food sales. An r of 0.97 across only seven data points is statistically generous, but also the kind of thing that makes a pet food executive feel unfairly important to the macroeconomy. Perhaps the pets themselves have been driving productivity gains all along. The cat has been on the hedge fund committee this whole time.
US GDP per capita and pet industry spending are both income-elastic measures that grew in tandem from 2016 to 2022. Pet spending grew from roughly $66 billion to over $136 billion as the 'pet humanization' trend — premium food, veterinary care, pet insurance, boarding — accelerated among higher-income households. GDP per capita grew from around $57,000 to over $65,000 over the same period before the pandemic disrupted and then inflated both measures. Both figures dipped in 2020 and rebounded sharply in 2021-2022, which with seven data points is enough to create a very clean regression line. A sample of seven is many things, but it is not certainty.
Seven data points and a high r-value is the statistical equivalent of a very confident guess. The correlation may be real, coincidental, or simply a product of two things that both go up when the economy goes up, which is the least surprising finding imaginable.
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Want to learn more about why correlations like “US GDP per capita” vs “US pet industry spending” don't prove causation? Read our guide to statistical thinking.
