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inadequate
indicator
of
development
today?
By the end of 1940s new era of development begins, in which
nations have equated economic growth with progress.
Economic growth is an increase in the production and
consumption of goods and services, and it is indicated by
increasing Gross Domestic Product (GDP) or Gross National
Product (GNP). GDP is the sum of the market values, or prices,
of all final goods and services produced in an economy during a
period. Gross National Product, or GNP, is the sum value of all
goods and services produced by permanent residents of a
country regardless of their location. It is the most important
measure in measuring the economic well-being of states, it has
a heavy impact on the decision-making of firms, consumers,
investors and governments and it is extremely popular in the
media. However, in light of vast changes in society, the
environment, and the global economy, many question whether
GNP is an adequate indicator of the well-being of countries and
their citizens.
GDP/GNP is a figure, which is generally recognized and
available for nearly all countries. It is a single figure,
which has a huge load of hints about not just the economy but
also the general living standard in a country. GNP explains
standard of living in a country but fails to include quality of life.
Standard of living generally measures through GNP only while
quality of life factors like equal protection of the law, freedom
from discrimination and freedom of religion etc. are more
difficult to measure and are particularly qualitative. It will be
wrong to say that a country whose GNP or standard of living is
high will also have good quality of life.
One of the limitations of GNP is that it does not give any sign of
income distribution. Although GNP may be increasing, this
wealth may be only going to a select few in the economy,
Bibliography
Webster, Andrew. (1990). Introduction to the sociology of
development
Sen, Amartya. 1999. Development as Freedom. New York:
Anchor Books
Human Development
development Indices
Report,
2003,
FAQs
on
the Human