Is an expanding GDP a good indicator of improvement in consumer quality of life?

  • A growing GDP is a positive indicator for quality of life.

    The growth of the gross domestic product (or GDP) is a signal that a country's overall economy is growing, since more goods are being produced. As production of goods and services increases, the number of people employed also increases. That means that more people have the income to spend on these goods and services.

  • Expanding GDP means people are willing to spend more.

    An expanding GDP reflects an improvement in consumer quality of life because it means that people have the confidence to spend more money. They will only have this confidence if they have a higher quality of life and trust that they will be financially stable in the medium to long term.

  • No, expanding GDP only represents more products being purchased.

    Quality of life and number of goods and services purchased are two completely separate entities. The amount of money spent on goods does not indicate a higher quality of life. On the contrary, it could indicate a lower quality of life when people are spending more than they are making on products.

  • An expanding GDP merely indicates how profitable a nation as a whole is.

    An expanding GDP simply means that more companies are profiting. It does not indicate from where those profits are coming nor is it, in any way, a reflection of who is benefiting most from those profits. It could be a very small portion of the population, in which case the consumer quality of life would improve very little in spite of increased spending.

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