Question

Should we continue to measure GDP as we do now? If you don’t think it should be changed, explain your reasoning. If you think it should be changed, what changes would you recommend, and why?

Answer 1

Gross Domestic Product (GDP) has long been recognized as being less than sufficient as a measure of our societies ' economic health and welfare. One of the well-known flaws of GDP, for instance, is its disregard for housework quality, including childcare. The monetization of such operations within the GDP calculation is a possible solution. It would definitely be right for the interest that is being overlooked at the moment. This would, however, result in GDP falling on another parameter, for which it has already been heavily criticized. It often does not adequately reflect the experiences of members of a society.

Today, both private and public sector decision-makers have more tools with which to make sophisticated choices. On the investor side, there is a steep increase in demand for information on the environment, social and governance. On the public side, organisations like the World Bank are already exploring measures other than GDP for measuring the quality of life, including life expectancy at birth and access to education.

Recently there has been an increasing debate about Gross National Income (GNI). Although it shares fundamental elements with GDP, in our globalized era, GNI provides a correction that matters. It adjusts for foreign-owned corporations and residents ' income. Accordingly, while countries with significant foreign corporations owning manufacturing or assets will show an inflated GDP, GNI reflects how much income each country actually retains.

First, there are already several weak aspects of GDP metrics being addressed and action is being taken by relevant stakeholders. That's motivating. Second, a multitude of instruments are now available to public and private decision-makers. This allow for a superior assessment of their behavior and how they impact communities and the world.

Finally, we learn not to let the great become the enemy of the good in company. We have not overcome all the challenges presented by GDP, but in reducing many of its contradictions, we have come a long way. Rather than seeking a new, disruptive framework to replace current techniques and data, a more powerful strategy may be to make considerable, incremental changes