First, GDP is a useless number. I wrote a <a href="http://intellectual-detox.

com
/2011/12/01/gdp-cpi/">detailed tear-down</a> on my own blog. It is fundamentally
impossible to determine in an objective, quantitative way how many times better
a 2014 computer is than a 2004 computer. Do you go by processing power? Or by t
ime it takes a person to complete a task? What task? Writing a Word document? Ed
iting a picture in photostop? The GDP calculations is filled with complicated te
chniques to create answers to these impossible questions. The techniques look pl
ausible - but if you examine them with rigorous logic you will see the numbers t
hey produce are entirely subjective and arbitrary. In reality, the economists wi
ll just keep adding up ajdustments until the GDP number overall fits with people
's intuitions. The end result is meaningless.
<em>"Women contributed through unpaid labor in the home, and their paid labor su
bstituted for that but didnt add to it. But as far as I know GDP only counts paid-f
or goods. Not only should womens labor in the home not have counted, but GDP should
overcount the benefits of putting women to work because paid daycare and so on
appear as valuable new services."</em>
That's not quite how it works.
The GDP is calculated by taking total nominal income (or expenses, they should b
e the same, but income is easier to think about) and then adjusting by a price i
ndex (the GDP deflator). Total nominal income is determined by the classic econ
equation - quantity of money times the velocity of money. In other words, quanti
ty of labor has zilch to do with nominal GDP.
So the impact of women entering the work force would need to be seen by the pric
es in the GDP deflator being lower than they otherwise would. But when women mov
ed from providing childcare for free, to entering the workforce and paying for c
hildcare, prices went up considerably. So would not expect this to show up as in
creased "real GDP"
<em>"Somehow in total contradiction to usual economic theory, all gains made by
women came out of the pockets of men, leaving the same growth as would have happ
ened anyway."</em>
That's because standard GDP theory views economic output as a unitary concept, a
nd does not think about what output really means on the ground.
Are the women who entered the workforce making cars? Building houses? Inventing
new gas fracking processes? Designing solar cells? Those productive professions
are still massively male dominated. Most women went into fields like marketing o
r sales, which are zero-sum. Many others went into healthcare, HR, administratio
n, and education. Those fields have all seen greatly rising costs in the last fo
rty years. If more labor enters a free-market sector, costs should go down (and
GDP deflator will go down). If more labor enters a beaurucratic sector, costs ma
y go up, as the workers politically agitate for more make-work in order to emplo
y everyone.
This is another way the GDP stats are useless. A solid portion of the female ent
ry into the workforce went toward increasing the quantity of healthcare produced
. But was this real output, that made us all better off? Do we have better healt
h care due to more spending on healthcare labor? Or was much of the spending dri
ven by beaucratic inefficiency, of expenses rising to meet whatever was budgeted
(last time I went to an emergency room for a simple bump in the head, I had to
tell my story to no less than eight different nurses and assistants)? The quanti
ty of schooling as likewise increased since women entered the workforce. Is this
real output? Or is it just bucreatic make work? There is no way to tell mathema
tically, you can only use your own judgement.