by Mellisa Corrie

Created on: May 06, 2008

"The Gross Domestic Product per capita, or GDP, of a country is one of the ways of measuring the size of its economy. GDP is defined as the total market value of all final goods and services produced within a given country in a given period of time (usually a calendar year). It is also considered the sum of value added at every stage of production (the intermediate stages) of all final goods and services produced within a country in a given period of time, and it is given a money value". This excerpt was extracted from the Wikipedia free encyclopedia in its definition of GDP. I could easily end the debate here and conclude that simply put GDP is simply placing a monetary value on the size of the economy, and frankly a great economy doesn't always mean quality of life or an eradication of poverty. After all the United States of America still has individuals going cold during the winter. However I want to really delve into what makes a society progressive, or better yet, what is the quality of life?

When GDP is measured it takes stock of productivity inputs and outputs, and by extension the purchasing power of the dollar. Now sure there is a strong correlation between high productivity and the efficiency of a nation's people, but does efficiency too mean a better standard of living for a people? Lets look at those countries in the middle east, for example Saudi Arabia who has a relatively high GDP but a large " lower class" and one would think with natural resources such as oil, the country would be flowing with all the lasciviousness of life. The fact is an efficient labor force, could mean a great amount of unskilled, low paid manual laborers. That is the problem with many eastern nations. While increasing their countries' GDP they remain low income workers living in deplorable conditions. Another example is India, where even today some sections don't have clean tap water. Now does that sound like living a quality life in a thriving economy. I mean the numbers show steadily increasing growth, but where does that money go and whose life is it progressing?

Economist often separate standard of living and Economic growth by a thing they call the Human development Index (HDI), and the reason for this is that the distribution of wealth in high producing countries are often very uneven, with the gap between rich and poor very wide. Another thing that you find is that the really "rich" countries in the world have strong banking sectors and high levels of tourism. An economy that has steady levels of monetary growth should in theory address the issues that make society better however they often disregard it, while only focusing on importing and earning foreign exchange. This tends to afford the people in authority a better life (To go off on that tangent is an entire book).

Economist created the HDI to address issues such as mortality rate, poverty, education levels, accessibility to the basic amenities and sustainable growth. These are the factors that truly measure a society's quality of life.

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