Explain Some Advantages of Using the Genuine Progress Indicator

Question

Examlex · Accepted Answer

The Answer is The Genuine Progress Indicator (GPI):
-considers a country or region's economic growth and social well-being.
-includes all variables calculated under the GDP, but subtracts the negative effects of economic growth that cause social harm to a community. The cost of crime, pollution, and resource depletion are a few examples. How does the cost of crime normally increase GDP? Let's consider a family injured in a home break-in. In calculating GDP, lawyer's fees, property damage repairs, and medical fees are treated as forms of revenue; however, since the action does harm to a society, in calculating GPI these revenues are subtracted.
-considers positive contributions of the family and the community that are not included in the GDP because no money changes hands. For example, the value of housework, volunteer work, and unpaid childcare all contribute to a society's well-being. Under the GPI, these actions are calculated at the approximate market value of hiring someone to do the work.
-helps us understand why a population may feel unhappy or dissatisfied despite economic growth.

Explain Some Advantages of Using the Genuine Progress Indicator

Definitions: