The purpose is to examine the usefulness of and the limits of measures of GDP.
Please discuss the following questions:
I. If GDP is a good measure of economic well-being, why is Switzerland’s Gross Domestic Product so much lower than India’s GDP or China’s GDP?
2. What measures would be better to compare the well-being of different countries?
If GDP is a good measure of economic well-being, why is Switzerland’s Gross Domestic Product so much lower than India’s GDP or China’s GDP?
GDP is a good measure of economic well being, but it is not an excellent measure of economic well being. Economic well being encompasses more standards than what GDP measures. In as much as GDP measures the total value of final goods and services within a country’s borders. Although it measures the size of a country’s economy it fails to take into consideration matters such as leisure, the quality of the environment, the level of health, technology, Negative and positive values of society and various elements that affect people’s happiness. (“How well GDP measures the well-being of society,” n.d.)
Switzerland’s Economic well being is much lower than that of India or China because of the size of its population compared to that of the other two. It is a much smaller country although wealthy.