Evaluation of GDP
Geography: KS3, topic 4.1.3
Problems with Economic Measures of Development
Measuring development by looking at the money and wealth of a country has problems. There are many things that this measure of development cannot tell you about quality of life in a country.
GDP
- One problem with measuring development using GDP or an GDP per capita is that it doesn’t tell you how much money each individual person in a country actually has.
- It only gives you the overall figure (GDP) or an average (GDP per capita).
Inequality
- So, a country’s GDP may look high but the wealth may belong to a few billionaires and the majority of the population may live in poverty and be very poor.
- Inequality is the difference between rich and poor.
- GDP does not measure this.
Government spending
- Another big problem is that the total GDP figure for a country does not tell you anything about what the government spends this money on.
- If a country has a very high GDP but doesn’t spend it on improving the quality of life for the people in that country, is it still developed?
Government spending cont.
- For example, a country with a very high GDP could spend it on weapons and nuclear weapons instead of providing a clean water supply for all of the people in that country.
- Is it still a developed country?
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