Osborne, GDP, & Recession April 25, 2013Posted by larry in economics.
I am here simply going to repeat something I wrote some time ago on this subject.The media along with certain politicians and economists get all fired up about miniscule alterations in an index that may in itself be inherently flawed.
There may well be no referent for the term GDP (or GNP) that has any real sociopolitical relevance, in the sense in which it is generally used by mainstream politicians and economists. A number of economists and related scientists have wondered over the years whether certain general notions such as GDP, conceived as collections of a number of individual measurements of different factors, actually ends up referring to anything meaningful. Indeed, the factors whose measures that make up, say, GDP can be seen as problematic themselves. A read of Myrdal’s Against the Stream should convince anyone of this who is not already convinced otherwise.
More could be said about this, for example, that the collection of individual measures into collective measures involves more than composition fallacies, but I will have to leave this matter for another time.