Question

Gross Domestic Product (GDP) is the final goods and services produced in an economy or country, within a specific period of time. It does not include the distribution of resources in the economy (Mankiw 2017). After viewing the power point provided I would say that using the GDP method would not give a good measurement of the national economic well-being. For example, GDP does not include intermediate goods: this is when an ingredient or service is used to help make the product, nonmarket products: this includes products that customers do not pay for, illegal goo0ds, and bad and resource depletion: this is environment pollution, water contamination and resources that are depleted. When you think of quality of life, you think of the way one would consider what a meaningful life is. To enjoy life sometimes you have to do things that will be in your leisure time, or enjoying things that you would not pay for, or even just purchasing products that will be able to entertain you. These may not all include spending money however, if leisure time is not included in the GDP  how can it accurately measure the economics well- being. In 2017 the top country with the highest GDP is the USA with a nominal GDP of 19.39 trillion dollars, while the country ranking number is China with a nominal GDP of 12.01 trillion dollars.  

Comment on this article in about 120 words

Answer 1

This article quite expressively raises doubt about GDP (Gross Domestic Product) being the best measure of economic well being. When the whole world is raging to increase their GDP numbers, very few are actually looking deep to find the actual definition of economic well being. Is Growth same as development? NO. Where the quantitative dimensions (GDP) are a necessary condition, qualitative dimensions (health,leisure, human capital, Overall Happiness, social welfare etc) build a road to make a country developed. With Per capita income measure losing on income distribution and a high income might build us a house, but more often it is seen that people are too busy make their life comfortable that they are forgetting to live. United states is one of the biggest achievers in terms of GDP, but the leading cause of disability in US is depression. China is one of the emerging economies with growth averaging 9%, but on income inequality tells a different story: 1% of the population holds 1/3rd of wealth. There is definitely something wrong with the picture we are being made to watch!