GDP Growth is a Poor Measure of Increasing Living Standards

GDP growth is a truely awful measure of improving living standards. Tje definition excludes all non=monetarised considerations such as environmental damage, climate change, pollution of atmosphere, contamination or shortage of water, even destruction of food species.

The definition of GDP growth has no useful relationship to the fruits of technology development, such as the introduction of colour television or the introduction of cheaper digital technologies.

Externalised costs are ignored in the calculatrion of GDP growth.  Increased disease and it treatment can contribute to GDP.  Obesity contributes to GDP in the course of its acquisition and again as we pay for attempts to cure its adverse effects.

The concept GDP suffers from the limitation of not being usable as a basis for comparison in changing environmental, political, social, and technological conditions.  No account is taken of the negative effects of devotng resources to war and destruction. Billions spent of invading Iraq, fighting obesity, of education children, contribute in like fashion to GDP.  Similarly a productive workers wages contribute to GDP just as those of an unproductive civil servant.

Indeed, on close examination of the definition of GDP it is difficult to conceiva a more flawed
measure of living standards and their growth.

Ref:
http://www.economist.com/debate/days/view/506