Question

Critically evaluate the main arguments for the retention of GDP as the fundamental metric of a country’s standard of living against the various alternative yardsticks such as the OECD’s “Better Life Index” or the UN’s “Human Development Index”.

Answer 1

Ans

One of the most important argument is that it is easy to measure. We do accept this argument but it must be noted that advances in economics has enabled us to measure HDI, Hpi etc also with accuracy.

Other arguments is that other measures like happiness index use qualitative data which is arbitrary. We agree with this argument but some other measures like HDI do use quantitative data. They are accurate and scientific as is gdp

Also it does not take into account bads like pollution into effect. Thus it will result in more production of bads. Neither does it show progress in other indicators like health, education, freedom etc. Other limitations are also present but they are found in many measures