Gross Domestic Product is a statistic based on measured numbers.
Not a scam.
However, that information can definitely be used to mislead and scam people, just like any other statistics.
No, but it’s a highly imperfect metric. I love this joke because it really demonstrates why: https://www.reddit.com/r/Jokes/comments/qp49wz/two_economists_are_walking_in_a_forest_when_they/
So people don’t have to visit that terrible site.
Two economists are walking in a forest when they come across a pile of shit.
The first economist says to the other “I’ll pay you $100 to eat that pile of shit.” The second economist takes the $100 and eats the pile of shit.
They continue walking until they come across a second pile of shit. The second economist turns to the first and says “I’ll pay you $100 to eat that pile of shit.” The first economist takes the $100 and eats a pile of shit.
Walking a little more, the first economist looks at the second and says, “You know, I gave you $100 to eat shit, then you gave me back the same $100 to eat shit. I can’t help but feel like we both just ate shit for nothing.”
“That’s not true”, responded the second economist. “We increased the GDP by $200!”
How could that have been mitigated or that loophole closed? Shouldnt GDP be linked to what is taxxed or something? If anyone can just say “line goes up” what use is that, there’s no like scarcity or its too malleable
It is used to scam the people of a country but is just a statistic that should be used correctly
GDP is the sum of all goods and services produced in the country. This is colloquially taken to be proportional to how well its people are doing economically, as opposed to what it actually represents: the value of the output of a country. This is an important distinction, because we could simply boost our GDP by 2x by bumping the price of every good by 2x. This would mean everyone is 1/2 as rich compared to before.
This is one reason why certain services such as medical care can be significantly better in another country and much cheaper, while having a significantly lower GDP. For example, Cuba vs the US
Governments will boast about GDP and stock market gains and say “the economy is doing well,” when that could very well mean that prices have gone up. “The economy” is another useful term which means anything politicians want it to mean, because they can point to measures people dont understand to say things are going well even when purchasing power is down and people feel squeezed
GDP also fails to account for who owns the value of the goods and services. For example, a foreign business run and operated within a country will extract profits to the foreign owners country, so the benefits of money circulating and the value of money gets removed from the economy.
GDP is used by the IMF to determine if loans should be given, and thus has become the default measure of a country’s wealth. This is an issue given the above problems alone
As a good guage of the success/greatness of a country? Yeah, kinda. It’s basically useless.
No, but it’s not a measure for how “successful” a country is
Inequality is bad for economies, but of course it’s celebrated in 'Murica
