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Gross domestic product: Are other measures needed?

Author

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  • Barbara M. Fraumeni

    (Hunan University, China, NBER, USA, and IZA, Germany)

Abstract

Gross domestic product (GDP) is the key indicator of the health of an economy and can be easily compared across countries. But it has limitations. GDP tells what is going on today, but does not inform about sustainability of growth. It does not measure happiness, so residents can be dissatisfied even when GDP is rising. GDP does not consider environmental factors or reflect what individuals do outside paid employment. It might increase in times of military conflicts and after natural disasters or terrorist acts, as the loss of property is not counted. Hence, complementary measures may help to show a more comprehensive picture of an economy.

Suggested Citation

  • Barbara M. Fraumeni, 2017. "Gross domestic product: Are other measures needed?," IZA World of Labor, Institute of Labor Economics (IZA), pages 368-368, May.
    • Handle: RePEc:iza:izawol:journl:2017:n:368
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    References listed on IDEAS

    as
    1. World Bank, 2020. "Poverty and Shared Prosperity 2020," World Bank Publications - Books, The World Bank Group, number 34496, December.
    2. Diane Coyle, 2014. "GDP: A Brief but Affectionate History," Economics Books, Princeton University Press, edition 1, number 10183.
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    Cited by:

    1. Sochi Iwuoha & Joseph I. Onochie, 2022. "Time Series Characteristics of Canada’s Beyond GDP Indicators," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 12(5), pages 1-6.
    2. Justyna Cader & Renata Koneczna & Piotr Olczak, 2021. "The Impact of Economic, Energy, and Environmental Factors on the Development of the Hydrogen Economy," Energies, MDPI, vol. 14(16), pages 1-22, August.

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    More about this item

    Keywords

    GDP; macroeconomic measures; national income accounting;
    All these keywords.

    JEL classification:

    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology

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