Time to scrap GDP measurements?
Posted by admin in Strategy & Planning on Tue, 17/08/2010 - 12:15
It's time to scrap the gross domestic product (GDP) as the main measure of economic output, reckons World Bank former chief economist and Nobel Prize winner, Joseph Stiglitz.
Speaking at the Australian Economic Forum, Stiglitz claimed that GDP could in face be a “misleading indicator” “Before 1990, the standard measure was not GDP, which focuses on what is produced in a country, it was the income received by the people in that country,” he noted. "Many of the problems have become much worse. Using a GDP as a measure of income has had a more damaging impact.”
He argued that measuring economic output was one thing, but it needs to be expanded to encompass other factors. “Income is only one of the things we care about. We care about leisure, our workplace and other things. If your measure is GDP, you're encouraging people to work more and more as opposed to leisure which is based on goods," he said.
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