A number of so-called “rich” nations, which most of the world’s population are seemingly attracted, to have been global economic leaders since last century—i.e., the 20th century or 1900s. United States, for instance, is believed to have since been back on the path of increase in standard of living after coming out of the Great Depression and World War 2 which, in a way, had stifled the growth in the country’s wealth that had begun with the Industrial Revolution in the latter half of the 19th century—i.e., the 1800s.
The standard of living (a conventional measure of economic well-being) of many so called rich nations, as evaluated by “the GDP (gross domestic product) per capita” (or the inflation-adjusted GDP per person), has been generally rising at impressive figures for decades, despite the enormous increase in population. But the citizens’ hardships and complaints on news and social media indicate that the distribution of wealth and rewards of so-called rich economies during the last twenty or so years might have become much less, and also much less equal between citizens.
If one compares the economic hardships, difficulties, or adversities that some or many citizens of rich nations go through on a recurring basis, it may be difficult to agree that living in a “rich” country—which is depicted by a special kind of GDP—provides a standard of living that is comfortable for a large part of the population.
Take a look at poverty rates: with poverty rates obstinately high, especially among children, it may be difficult or impossible to agree that if you live in a “rich” country (or a country with an exceptional GDP), then you’re automatically living well. In other words, living in a rich country doesn’t automatically mean you’re living well!
The GDP (gross domestic product) portrayed by rich nations via news outlets and also to the masses should, therefore, not be taken as a convincing sign of how well the citizens—especially the basest of citizens—are living, economically and in some oth3er regards. In other words, the GDP is not always the perfect yardstick for measuring human economic well-being.
There are recognized concerns about using GDP to label some nations as “rich” and generally express human economic well-being of citizens. A quick research in some basic economics textbooks would show that GDP doesn’t take into consideration some very important elements of living that people might value. Two very important—if not the most important—elements of living are (1) the ability to live with or without having to work or earn a living, and (2) the quality of the natural or existing environment in which one lives.
Other concerns about GDP include the difficulty in evaluating economic outputs correctly or systematically; for example, when comparing the value of a rental property to an owner-occupied property, and the value of rising GDP after any occurrence of natural disasters—especially when certain activities have been conducted to rebuild damaged environments. The GDP after destruction is evaluated without always considering the overall level of destruction.
Evaluation of the GDPs being shown to the masses may need to take into account the various shortcomings or issues that have been stated in the previous paragraph, so as to make them (the GDPs) more meaningful to people when governments announce an increase or reduction in their incomes.
Concluding words
One could argue that, when it comes to matters relating to the environment, it may be sometimes difficult to put an economic value on various items included in GDP; however, expressing a value that labels a nation as “rich” does not hide the fact that a good number of people are not living well; also, it doesn’t hide nor change underlying problems such as scare economic goods and subpar or deteriorated environments.
The existing GDP yardstick might be okay for measuring what it currently measures, but it’s definitely not okay when one considers what it does not measure. The gross domestic product (GDP) of any so-called “rich” country should, therefore, not be regarded as a perfect yardstick for depicting that people are living well, when in reality they aren’t.
MoTEnv — MTE 