Examples of GDP as a weak measure of progress/ productivity.

Originally Posted by Mike*******Thread topic: 'Interest rate' solution to inflation- a case of mere optical illusion?
you really got a very weird thinking there.
Originally Posted by C6An accident like the Fukushima nuclear disaster can also increase GDP too: e.g. 'Fukushima cleanup could cost up to $250 billion'- unnecessary work and expense if only the safety aspects of managing the reactors had been better considered.
can you tell me how does a natural disaster increase the GDP of that country? Before a massive reconstruction is to take place, the whole bloody economic system is crippled and you have no OUTPUT for some time. After the crisis, then only reconstruction can take place. But after reconstruction, the economic level may not reach the pre-crisis level. In the end, its still a net loss to the economy. What is happening right now is a very good example. Since the Japan Earthquake and Thailand Flood, the world's economy is still in a doldrum.

Hi Mike, what I understand about Gross Domestic Product (GDP) is that its a very very gross calculation of productivity: one that includes both good as well as bad.

GDP per se is a very gross and oft arbitrary measure as I explain. Suppose I asked you what was the GDP of an imaginary (undiscovered) tribal community of 100 living in isolation from civilization- your answer would either be "don't know" or quite possibly "zero" since such a subsistence culture does not requisite the need for currency in their daily interpersonal transactions- honour/ barter systems suffice- yet the community continues to thrive in so far as they have done so for eons. To state that such a tribal community were inferior to that of say Swiss society (high GDP) without further specifications would be presumptuous if not chauvinistic to say the least- the wide difference in GDP of each society being largely the consequence of the establishment of local currency and exchange rates- subsistence farmers eat/ barter their own produce rather than trade it for money- thus the 'lower' perceived GDP. In short, the isolated tribal community is no less a society merely because it does not have a complex and complicated financial system as the so call industrialized countries have, "not everything that counts can be measured and not everything that can be measured counts"~ A Einstein.

There are also many versions of GDP presentable- for one, the per capita GDP of Fukushima has certainly gone up by many folds- once possibly a thriving community based upon tourism and nuclear energy related industry, 20+km of peri-nuclear reactor area is now a nuclear no-go zone only admissible to nuclear clean-up/ monitoring teams- so ironically, per capita GDP has increased multifold- due both to the exodus of communities and clean up operations.

Also, I have even read of clean up bill calculations higher than the USD250billion quoted- just depending on what you total- annualized, his could also possibly be higher than the original GDP of Fukushima prior to the disaster- e.g. fishing village/ nuclear energy facility: again suggesting that GDP is an inappropriate description of human development.

The 2011 BP Oil Spill is another example of an avoidable disaster now estimated to cost US$40billion in costs [Huffingtonpost.com]- compensatory and clean up- would the area's GDP rise with an intensive rebuilding and clean up effort now active in the affected areas?- Quite possibly: yet with the exception of the depraved, who would suggest that the oil spill was in some way productive despite some GDP related parameters 'progressing'?

Rgds,
C6  

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At/ related:
HWZ:
07May2012: 'Interest rate' solution to inflation- a case of mere optical illusion?
SBY:
07May2012: Examples of GDP as a weak measure of progress/ productivity.
SGforum:
07May2012: GDP: a weak measure of progress/ productivity.
A1:
07May2012: GDP: an inadequate measure of progress/ productivity.

07May2012: Examples of GDP as a weak measure of progress/ productivity.