Real GDP: The Flawed Metric at the Heart of Macroeconomics

Real GDP: The Flawed Metric at the Heart of Macroeconomics
Fix, Blair and Nitzan, Jonathan and Bichler, Shimshon. (2019). Real-World Economics Review. No. 88. July. pp. 51-59. (Article - Journal; English).

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Alternative Locations

http://www.paecon.net/PAEReview/issue88/FixNitzanBichler88.pdf, https://www.academia.edu/39790816/Real_GDP_The_Flawed_Metric_at_the_Heart_of_Macroeconomics, https://www.econstor.eu/handle/10419/200206

Abstract or Brief Description

The study of economic growth is central to macroeconomics. More than anything else, macroeconomists are concerned with finding policies that encourage growth. And by ‘growth’, they mean the growth of real GDP. This measure has become so central to macroeconomics that few economists question its validity. Our intention here is to do just that. We argue that real GDP is a deeply flawed metric. It is presented as an objective measure of economic scale. But when we look under the surface, we find crippling subjectivity. Moreover, few economists seem to realize that real GDP is based on a non-existent quantum – utility. In light of these problems, it seems to us that much of macroeconomics needs to be rethought.

Language

English

Publication Type

Article - Journal

Keywords

aggregation national accounting economic growth neoclassical economics quality change utility

Subject

BN Macro
BN Methodology
BN Production
BN Data & Statistics
BN Growth
BN Ideology

Depositing User

Jonathan Nitzan

Date Deposited

10 Jul 2019 19:10

Last Modified

13 Jul 2019 04:19

URL:

http://bnarchives.yorku.ca/id/eprint/609

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