Read this great article on GDP not being the most effective measurement of economic success. Gross Domestic Product (GDP) does not do a good job of measuring areas of success like job quality, wellbeing, carbon emissions, inequality, and physical health, even though decades of research showcase how all of these measures of success contribute greatly to living a life worth living.
The issue with GDP is that it only measures economic growth. Are we saying economic growth is bad? No. Rather, we are saying that it is one of many data points that should be measured. For example, current economic growth measurements discourage savings. Why? Because 70% of the U.S. economy relies on consumer spending. Small decreases in consumer spending, like saving money, reduces economic activity and therefore hurts GDP. Yet, the number one issue for today’s citizen remains their financial well-being.
One of the biggest growth factors in GDP over the last five decades is health care. In 2021, nearly 20% of GDP was health care related. In 1961, health care accounted for about 5% of GDP. Because of such a high level of GDP, our governments have very little motivation to get people healthier because it will hurt economic growth.
When the number one health risk today is stress and the number one stressor is money, then why is society not stress free? Never in the history of our society has the world been in a better financial situation over the last two decades, based on GDP. Enjoy the read.