Ecomomics questions on Growth,GDP and Happiness

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Growth,GDP and happiness

  1. Outline the limitations of using GDP as a measure of living standards. Use examples to support your answer. 

Gdp doesn’t take into account the amount of debt/ debt-servicing costs so countries who may be very rich may have a large debt which could lead to future generations paying higher taxes and less consumer spending aswell as government spending.

There level of gdp may also have been achieved by changes in leisure/working hours and overall working conditions which can affect family/social life and is a factor in measuring living standards.

Gdp may be undervalued as it does not consider the value of non-marketed output and unpaid work e.g voluntary care

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  1. Research the country of Bhutan and briefly explain the concept of “national happiness”.

National happiness (GNH) is a qauntative measure of the collective happiness and well-being of a population.

The Buddhist nation of Bhutan was the first society to determine policy based on the happiness of its citizens, with the king of Bhutan claiming in 1972 that Gross National Happiness (GNH) was a more important measure of progress than Gross National Product. Bhutan has a population under 800,000 and the average income is about $110 per month however life expectancy has doubled in the ...

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