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does not matter if u produce a gun or a bycicle, household productions, health and life expectancy, leisure time, environment damage.
than why bother with GDP?

2007-08-21 22:35:40 · 2 answers · asked by freeman 3 in Social Science Economics

2 answers

GDP is a measure of market activity not quality of life. It's purpose is to help government policy makers in formulating monetary and fiscal policy and to predict future needs for welfare assistance, and to compare different parts of the country. GDP does not count the number of guns or bicycles etc. but what consumers paid for them assuming that a higher quality product will cost more and that consumers will allocate their spending to satisfy their needs. Some attempt is made to account for the vast improvements in the technology of products like computers. The year to year changes are more meaningful than the absolute value since the comparisons over long time periods have problems with the large technology changes that take place of time period of 50 years.

2007-08-22 04:04:33 · answer #1 · answered by meg 7 · 0 0

GDP was invented to create an illusion the US still produces something of value besides agricultural products and raw materials.

We're an economy of government workers and people selling hamburgers back and forth to one another.

2007-08-22 01:02:33 · answer #2 · answered by Jack P 7 · 0 0

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