Minimal repro of an issue in dbt-core: transitive local dependency is resolved from the directory of the endmost dbt project, not from the directory of a dependency whose packages.yml specifies the correct location.

• a/
  • An empty dbt project that depends on common1, which then depends on common2.
  • dbt deps command succeeds since common2 can be resolved from a by ../common2.
• b/c/

  • Another empty dbt project that depends on common1, which then depends on common2.

  • Running dbt deps in b/c fails with the following error, because ../common2 cannot be resolved.

    06:14:46  Running with dbt=1.1.1
    06:14:47  Encountered an error:
    Runtime Error
      no dbt_project.yml found at expected path /some/path/to/dbt_local_dep_path_issue/b/common2/dbt_project.yml