Gross Domestic Lies
Lies, damn lies and GDP statistics.
Geographers often use Gross Domestic Product as an indicator of how well a country is doing. GDP, so the argument goes, is a more objective measure of development - especially when compared to 'soft' criteria such as Gross National Happiness.
Geographers often use Gross Domestic Product as an indicator of how well a country is doing. GDP, so the argument goes, is a more objective measure of development - especially when compared to 'soft' criteria such as Gross National Happiness.
Now economists have come clean, GDP is "an imperfect measure" - that's according to The Economist.
GDP, says the Economist, can be measured in three different ways:
Each country does it differently. For example, Britain and The United States use different methods to calculate GDP, but we geographers often make direct comparisons using data from (potentially) incomparable national systems.
If this was not enough, GDP is calculated on the basis of "surveys" and in many cases, economists "estimate" GDP to meet deadlines. Of course, surveys of manufacturers and builders is going to be reliable - no company or politician is going to lie, make mistakes or otherwise distort the true picture of economic activity, are they?
So if GDP is an imperfect measure in Britain and the United States, can we trust GDP data from countries that have significantly higher levels of corruption?
Maybe Gross National Happiness is not such a bad index after all?
GDP, says the Economist, can be measured in three different ways:
- by adding up all the money spent each year,
- by adding up all the money earned each year, or
- by adding up all the value added each year.
Each country does it differently. For example, Britain and The United States use different methods to calculate GDP, but we geographers often make direct comparisons using data from (potentially) incomparable national systems.
If this was not enough, GDP is calculated on the basis of "surveys" and in many cases, economists "estimate" GDP to meet deadlines. Of course, surveys of manufacturers and builders is going to be reliable - no company or politician is going to lie, make mistakes or otherwise distort the true picture of economic activity, are they?
So if GDP is an imperfect measure in Britain and the United States, can we trust GDP data from countries that have significantly higher levels of corruption?
Maybe Gross National Happiness is not such a bad index after all?
