>GDP is understated--has been for many years--as the economists still >use the wrong measures to calculate that index. (ie. traditional >manufacturing should not be weighted to the same extent, etc).
hmm? there are no "weightings" in the gdp -- it is a raw measure. "weightings" come into play with the cci, which, of course, i believe is grossly overstated. the major imperfections in the gdp that i'm aware of are the fine lines of defining "domestic" (aided to some extent by transition from gnp to gdp as a measure), and the dubious basis behind thinking that "more production" is a good thing. if you build yourself a house, you aren't creating wealth in the gdp sense -- but if you pay someone to build you a house, you are creating wealth. no sense to it at all. this is especially true when the goods created are intangible (which i guess relates to your point about manufacturing). lastly, of course, there is the fact that every time there is a fatal accident, every time there is a cancer diagnosis, every time someone files a meaningless lawsuit, our gdp goes up -- is this really what we should be aiming for? but enough from me. |
