There are a couple of key components to the present question. What must be determined is what GDP measures. this could be compared to the definition of the terms \\\”economic measure\\\” and \\\”nation\\\’s progress\\\”.
What Does GDP measure:
According to Wikipedia \\\”GDP is that the market price of all officially recognized final goods and services produced within a rustic during a given period of your time .\\\”
The GDP equation is: GDP = private consumption + gross investment + government spending + (exports − imports), where:
– Consumption = the market price of products and services that folks have consumed
– Gross investment = the worth of what\\\’s being saved and consumption deferred, the worth of assets that don\\\’t depreciate
– Government spending = the quantity a government spends
– Exports – imports = what stays within the nation
– a few things come to mind when watching this calculation:
– market prices are often defined because the price which someone is ready to pay and therefore the price which someone is ready to spare the products and services. Therefore \\\”value\\\” can only be determined when there\\\’s an overlap between these two criteria. As such, it\\\’s not clear whether goods or services produced but not consumed wouldn\\\’t be included within the calculation.
– With the expansion in complex financial instruments and sophisticated accounting, it\\\’s not clear to me if Gross Investment would come with or exclude investment in intangible assets like derivatives.
Define \\\”economic measure\\\”:
GDP is merely one among many economic measures of a nation\\\’s progress. Others include:
Gross domestic product
GDP per capita
Rate of Inflation
Balance of Trade
Define \\\”nation\\\’s progress\\\”:
From the Australian Concise Oxford Dictionary: \\\”Progress: 2. The advance of development to a far better state.\\\”
To be ready to determine a \\\”nation\\\’s progress\\\’ using the definition of \\\’advance of development to a far better state we\\\’d like a couple of things. Firstly we\\\’d like to be ready to identify areas during which a nation can make progress. Then we\\\’d like to be ready to quantify the past state, present state, and future state of those areas.
Areas during which a nation can make progress:
1.Access to and efficient use of energy and resources
2.Access to and efficient use of leisure
3.Access to healthcare
4.Access to quality education
Research and development
Sense of community/connection to something larger
Population growth and demographics
Legislation, law, and policing
Safety, security, anticipation
Town planning and living conditions
This is not designed to be a definitive list.
We need to match what GDP measures to what we define as measuring a nation\\\’s progress.
When we compare what GDP measures with the list of areas that may determine a nation\\\’s progress we will see both overlaps and underlap.
The theory when suggesting that GDP may be a measure of a nation\\\’s progress is that if a nation produces quite what it did last year then that nation\\\’s citizens would enjoy increased employment, increased salary/share of profit, increased dividends from the nation\\\’s share market, etc.
To illustrate where there\\\’s overlap, allow us to consider one particular area as an example. Let\\\’s suggest that we agree that improving the standard and quantity of education will help the nation progress. to enhance the standard and quantity of education there\\\’ll be got to be investment, government spending, and consumption of things like schools, teachers, books, universities, corporate education, and other educational infrastructure. All this activity will show up during a calculation of GDP. This logic is often extending to several areas during which a nation can make progress.
What GDP doesn\\\’t measure is that the effort, stress, and price of manufacturing GDP. for instance, there is, perhaps, an increased level of stress related to the insecurity of employment as we move to contracts and part-time arrangements. This stress is going to be exposed to an increased need for healthcare.It doesn\\\’t measure the worth of what was produced. you\\\’ll have a huge increase in GDP because the govt \\\’invested\\\’ in bourgeoisie welfare that was then spent on flat-screen TVs. it\\\’s questionable whether increasing the standard of the screen with which we watch infinite cooking shows progresses a nation or not. there\\\’s also an assumption that more is best. simply because we are spending more or maybe generating more doesn\\\’t necessarily mean we are progressing. To continue the education example from above: perhaps we are investing in educational infrastructure where what might be holding us back as a nation could be students\\\’ and parents\\\’ attitude towards education.
So, what\\\’s the worth of GDP as an economic measure of a nation\\\’s \\\’progress\\\’? As soon as you are trying to live something as intractable and sophisticated as a \\\’nation\\\’s progress,\\\’ nobody\\\’s measures are going to be sufficient.So if the question had been \\\”What is that the value of GDP because the measure of a nation\\\’s progress\\\” the solution would be something along the lines of \\\”close to useless.\\\” However, the question is \\\”what is that the value of GDP as an economic measure of a nation\\\’s progress?\\\” intrinsically I might suggest there\\\’s value in measuring GDP and including it during a basket of measures to work out a nation\\\’s progress.
Rod Matthews may be a leading expert in changing human behavior within groups and organizations. Rod is usually mentioning as \\\’the best trainer in Australia\\\’. As an author, facilitator, presenter, and therefore the principle of Impact Human Performance Technologies, Rod Matthews has spent the past 15 years changing individuals, groups, and organizations. His presentations and courses are thought-provoking, insightful, interactive, and hilarious. As a voracious reader of non-fiction, Rod loves testing what he finds in books, articles, and websites within the world.