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What’s wrong with gdp
- 1. What’s wrong with GDP? MireilleKhouri - Marie Mège - Brannon Naito - Lu Sun
- 2. What is GDP? •Gross Domestic Product is the market value of all officially recognized final goods and services produced within a country (usually calculated on an annual basis) • The basic formula for calculating the GDP is: GDP = C + I + E + G Consumer spending Investment made by industry Excess of export over Import Governmen t spending
- 3. What does itNOT measure? • 1. Health • 2. Infant mortality • 3. Morbidity • 4. Suicide rates • 5. Crime • 6. Poverty • 7. Environmental health/decay and destruction of the natural environment • 8. Infrastructure such as highways and bridges • 9. Family breakdown • 10. Loss of leisure time • 11. Cost of commuting to work • 12. Lack of civility in communities • 13. Lack of concern for future generations • 14. Income gap (women/men; poor/wealthy)
- 5. Alternatives to theGDP? GPI (Genuine Progress Indicator) Efforts to Capture the Environmental Sustainability Aspects GSDP (Gross Sustainable Development Product) • Measures the cost of growth and development GESDI (Gross Environmental Sustainable Development Index) • Measure the quality of growth and develoment
- 6. The GSDP Measures: •Economic impacts of environmental and health degradation or improvement • Resource depletion, depreciation or appreciation or finding new resources (stocks) • Impact of people activity on environment • Impact of people activity on availability of resources • Impact of people activity on economic development • The quality of environment, people, resources and development and impact of changes in these on the national income and wealth • Impact of global concerns on the economy • Welfare, quality of life and economic development of future generations • Expenditures on pollution, health, flood, car accidents • The resource stocks and productive capabilities of exploited people and ecosystems • The impact of economic growth on biological diversity • Impacts of social costs, health costs, on future generations and the nation’s income
- 7. The GESDI Measures(200 indicators): • People (111 indicators) – includes dimensions of social, economic, psychological, physical and spiritual indicators as well as literacy, rights, justice, diversity, community, peace and conflict, legal and political, etc) • Available resources (11 indicators) • Environment (41 indicators) • Economic Development (70 indicators)
- 8. What does GPImeasure? • 1. Unpaid work (housework, parenting and care giving) • 2. Crime • 3. Family breakdown • 4. Household work • 5. Volunteer work • 6. Income distribution • 7. Resource depletion • 8. Pollution • 9. Defense expenditures • 10. Long term environmental damage (wetlands, ozone, farmland, • 11. Changes in leisure time • 12. Life span of consumer durables and public infrastructure • 13. Dependence on foreign assets • 14. Services (highways, streets) • 15. Loss of leisure time (to devote to community, self, hobbies, relaxation, spend with family) • 16. Cost of auto accidents • 17. Cost of under- employment • 18. Cost of noise pollution and household pollution (sick house syndrome)
- 10. List of countriesby GDP:
- 11. What’s wrong withthe GDP? GDP only measures the gross, overlooking the net. Social factors are not reflected in the calculation of GDP. GDP encourages a single bottom line mentality for businesses.
- 12. GDP measures income,but not equality, it measures growth by not destruction, and it ignores values like social cohesion and the environment. • The world must adopt and standardize a different indicator to enable evaluations of a country’s social factors. • Changing the focus on the country level will contribute to a socially positive trickle-down effect.
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