What be the restrictions of measuring development in country by gross domestic product. What be the restrictions? What be advantages?
i not really get this, is is that levels of economic development are hard to measure accurately. what to measure be restrictions in trying to ompare levels of development. i not find any advantages.
I may have mislead you about GDP by trying to oversimplify it.
This site has some pros and cons.
http://wiki.answers.com/Q/What_are_the_pros_and_cons_of_GDP
thanks very much ms. sue :) what does long hx of use means?
so for first part is asking for limitations, and that be the measures arnt accurate, it doesnt tell clearly how wealth is distributed in nations, in developing countries you not be able to determine level of industrialization, value of services, exports and imports in developing countries like in developed countries. if wealth of country not shared among the people, the average income figure not reflect the standarf of living for majority. so these all be limitations?
advantages:
good comparision data that be easy to calculate and it be used to measure in all countries.
and ms. sue i find this what it means?
developing economies have many people who make goods at home and trade them in local communites. Money may not be used in these transactions. this makes it impossible to measure this output. this kind of production is not included in the countrie's acounting systems.
Measuring development in a country using Gross Domestic Product (GDP) has both limitations and advantages. Let's start with the limitations or restrictions:
1. Narrow Focus: GDP primarily measures the market value of all final goods and services produced within a country during a specific time period. It does not account for other important aspects of development, such as social well-being, distribution of wealth, environmental sustainability, or quality of life.
2. Ignoring Informal Economy: GDP calculations often overlook economic activities in the informal sector, such as small businesses or unregistered labor. This omission can lead to an inaccurate representation of a country's actual economic productivity.
3. Externalities and Sustainability: GDP does not consider the negative externalities associated with economic growth, such as environmental degradation or social inequality. It fails to account for the long-term sustainability of development.
4. Non-Monetary Factors: Many essential dimensions of development, such as education, healthcare, sanitation, and political stability, are not adequately captured by GDP. It doesn't address non-monetary indicators that are crucial for assessing human well-being.
Now let's discuss the advantages of using GDP as a measure of development:
1. Simplicity and Comparability: GDP provides a standardized and easily comparable measure across different countries and time periods. It simplifies the assessment of economic performance and allows for benchmarking between nations.
2. Economic Growth Indicator: GDP growth rates can indicate the pace of economic development and measure improvements in a country's standard of living.
3. Policy Analysis: GDP data assists policymakers in formulating economic policies, analyzing economic trends, and identifying areas that require attention or investment.
4. International Relations: GDP is often used in international comparisons to rank countries and determine their economic influence and competitiveness.
It is important to note that while GDP provides valuable insights into the economic aspect of development, it should be used alongside other indicators to form a more comprehensive understanding of a country's development.