17: limitations of GDP

real GDP per capita

• To compare changes in standard of living (either intertemporally or internationally) the growth rate of real GDP per person is called read GDP per capita

• Real GDP per person = real GDP/ population 

economic growth

increase i real GDP

green GDP

GDP- estimated cost of greenhouse gas emissions and pollution 

happy planet index

GDP- estimated cost of depleting non-renewable resources

human development index

• HDI or human development index is a summary composite index that measures a country’s average achievements. This method considers 3 main factors, which include 2 social factors (life expectancy and education) as well as one economic factor (GNI or gross national income). 

• The value of HDI ranges from 0 to 1, 0 being not developed and 1 being developed.

Genuine progress indicator

GPI or genuine progress indicators take fuller account of the well-being of a nation, only a part of which pertains to the health of the nation’s economy, by incorporating environmental and social factors. It considers cost of crime, inequality in income distribution and more factors that real GDP per capita is not able to include.