Friday August 14, 2020

Aidan Regan: GDP dictates everything, but how do we measure it properly?

Whenever you see an economic variable expressed as a proportion of GDP, you should take it with a huge pinch of salt

2nd August, 2020
3
We measure government debt, deficits, spending, and taxes as a proportion of GDP. But what exactly is it?

Gross domestic product is perhaps the most influential number in politics and economics. Governments rise and fall by it. It is a measure of economic activity, and used to assess the economic welfare of society. We measure government debt, deficits, spending, and taxes as a proportion of GDP. But what exactly is it? Who constructs it? And how reliable is it as a measure of the economy?

I love measuring things. I particularly like calculating...

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