Is higher GDP a good thing?

Today’s news that the U.S. GDP shrank by 6.2 percent in fourth quarter 2008 got me thinking about the question whether a growing GDP is actually a good thing.

Some people would say I must be crazy (or even evil) to even ask that question. Growth is an important assumption behind the prevailing economic model — the economy must grow so more people can live at a higher level materially.

The Wikipedia entry for gross domestic product (GDP) defines and explains GDP.

Wikipedia also has an entry for an interesting alternative measure, the Happy Planet Index (HPI), advocated by an organization called the New Economics Foundation (nef).

The nef says it is creating “a new framework for real wealth creation by redefining wealth to focus on increased well-being and environmental sustainability rather than on just having and consuming more things.”

AB — 27 February 2009

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