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Philosophy, Political Science, and Sociology Philosophy, Political Science, and Sociology Forum - Perennial Ideas and Debates that cross societal/time boundaries


View Poll Results: Replacing the GDP?
GDP is easy and dominant and just continues using it. 2 40.00%
GPI (Genuine Progress Indicator) 0 0%
ISEW (Index of Sustainable Economic Welfare) 0 0%
Green GDP (GDP that includes environmental costs) 0 0%
Others 3 60.00%
Voters: 5. You may not vote on this poll

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Old March 10th, 2016, 12:29 PM   #11
hop
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Not that we'll known ....
Not in the UK, no. Neither is this:

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The UKs standard of living has climbed to the joint fourth-highest within the European Union, overtaking the Netherlands and significantly ahead of France, Italy and Spain, according to official figures compiled by Eurostat, the statistical office of the EU.

UK standard of living rises to fourth highest in EU | Money | The Guardian


The measure Eurostat used, Actual Individual Consumption, is another candidate that could be used to replace GDP:


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AIC incorporates all goods and services that a household consumes, including benefits-in-kind, such as health and education services.
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Old March 10th, 2016, 12:59 PM   #12
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Originally Posted by hop View Post
Not in the UK, no. Neither is this:




UK standard of living rises to fourth highest in EU | Money | The Guardian


The measure Eurostat used, Actual Individual Consumption, is another candidate that could be used to replace GDP:
I wonder how much of that is based on credit.
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Old March 10th, 2016, 01:07 PM   #13
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Originally Posted by hop View Post
Not in the UK, no. Neither is this:




UK standard of living rises to fourth highest in EU | Money | The Guardian


The measure Eurostat used, Actual Individual Consumption, is another candidate that could be used to replace GDP:
That just means more individual debt
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Old March 10th, 2016, 02:18 PM   #14
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I wonder how much of that is based on credit.
Debt to income ratios are falling, so the effect of credit is negative. In the UK for example, debt to income has fallen from a high of 142% in 2008 to 126% in 2014.

UK debt also isn't particularly high. If you look at the EU countries on that list:

Germany - 83%
Austria - 83%

Denmark - 265%
Finland - 110%
Sweden - 149%
UK - 126%

Eurostat - Tables, Graphs and Maps Interface (TGM) table

And that's gross debt. Most UK debt is in the form of mortgages on property. Net household wealth (ie assets minus debt):

File:Net financial wealth of households as a percentage of GDP, 2007 and 2011.png - Statistics Explained

In other words, it's not debt funded.
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Old March 10th, 2016, 02:23 PM   #15
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Originally Posted by hop View Post
Debt to income ratios are falling, so the effect of credit is negative. In the UK for example, debt to income has fallen from a high of 142% in 2008 to 126% in 2014.

UK debt also isn't particularly high. If you look at the EU countries on that list:

Germany - 83%
Austria - 83%

Denmark - 265%
Finland - 110%
Sweden - 149%
UK - 126%

Eurostat - Tables, Graphs and Maps Interface (TGM) table

And that's gross debt. Most UK debt is in the form of mortgages on property. Net household wealth (ie assets minus debt):

File:Net financial wealth of households as a percentage of GDP, 2007 and 2011.png - Statistics Explained

In other words, it's not debt funded.
Interesting stuff. I wonder why on earth Denmark's (and the Netherlands') debt ratio is so high.
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Old March 11th, 2016, 09:39 AM   #16

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Originally Posted by GogLais View Post
Interesting stuff. I wonder why on earth Denmark's (and the Netherlands') debt ratio is so high.
Canada also has a debt ratio at 155%.
As much as some people advocate cashless society, many personal finance advisors recommend "cash and debit only for daily expenditure, credit cards only for major expenditure."
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Old March 11th, 2016, 12:30 PM   #17
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I wonder why on earth Denmark's (and the Netherlands') debt ratio is so high.
Gross household debt usually increases with home ownership (and property prices). Renters don't have mortgages, so gross debt is lower. Germany and Austria have fairly low home ownership rates. However, Denmark doesn't have a particularly high rate, and its net household wealth isn't very high either (net household wealth also tends to be higher with higher home ownership and property prices).
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Old March 13th, 2016, 02:38 PM   #18

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no. GDP is misused and misintrepreted.

It's a tool for seeing the size and structure of an economy, little else. Bad economists and the media twist it into a tool for measuring wealth or wellbeing. China has a bigger GDP than Germany, but which country of the two has better living standards? Not hard to gauge which, eh?

The UK has a bigger economy than Denmark, though Denmark is better off in most measures of living standards. France is a bigger economy than the Netherlands, but again the same. If one wants to measure size, strucutre and influence, then fine. yes, GDP. If measuring living standards or material wealth of citizens, there are many better measures. GDP should stay, but then the media and good economists should say that GDP cannot convey average personal wealth of a country. SO no more Fareed Zakaria saying that the USA is the richest country in the world by virtue of its biggest GDP. Canada has better living standards, as do Denmark, Norway, and Ireland.
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Old March 13th, 2016, 02:41 PM   #19

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UK just ahead of Japan on that one. Seems strange.
the japanese economy hasn't grown well for the best part of twenty years. it's not as wealthy a society as it once was, especially compared to the 1980s.
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Old March 13th, 2016, 06:14 PM   #20

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Originally Posted by notgivenaway View Post
no. GDP is misused and misintrepreted.

It's a tool for seeing the size and structure of an economy, little else. Bad economists and the media twist it into a tool for measuring wealth or wellbeing. China has a bigger GDP than Germany, but which country of the two has better living standards? Not hard to gauge which, eh?

The UK has a bigger economy than Denmark, though Denmark is better off in most measures of living standards. France is a bigger economy than the Netherlands, but again the same. If one wants to measure size, strucutre and influence, then fine. yes, GDP. If measuring living standards or material wealth of citizens, there are many better measures. GDP should stay, but then the media and good economists should say that GDP cannot convey average personal wealth of a country. SO no more Fareed Zakaria saying that the USA is the richest country in the world by virtue of its biggest GDP. Canada has better living standards, as do Denmark, Norway, and Ireland.
This is far clearer this way.
I guess even GDP per capital doesn't quite reflect living standards.
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