MEASURING output is the best way we have of taking the temperature of an economy. But the industry standard, gross domestic product (GDP) has a host of weaknesses. It is reliant on an arbitrary definition of what is productive, so it includes childcare by nannies but not by house-husbands and wives. It takes no account of who is doing the producing, meaning an economy could have a single worker or full employment. It ignores the underground economy to a large extent, guaranteeing that production always undershoots reality. But more than any of these, GDP is extremely difficult to measure.
- GDP a poor measure of progress, say Davos economists | World Economic Forum
- The Republic of Wellbeing? Life Beyond GDP Event | Network of Wellbeing