The Real Meaning of Gdp
Project—— The real meaning of GDP
I. Background
Since 1985, when the State Council of China approved to establish a System of National Accounting (SNA), using the gross domestic product (GDP) to measure the national economy, more and more people are getting familiar to this word. We must have heard about it for countless times. At the end of 2010, China has overtaken Japan as the world's second biggest economy in terms of GDP, which has drawn attention all around the world and has made Chinese people proud of the rapid development over the past decade. However, there are still a large quantity of people in China or even in the world that know nothing about GDP. Moreover, still many people do not fully understand the real meaning of GDP even they have heard about this economic term before. GDP per capita is often considered an indicator of a country's standard of living whereas there are limitations and criticisms against the belief that GDP measures a country’s living standard. Many economists (for example, who? Add sources) argue that GDP is an empty abstraction devoid of any link to the real world, and, therefore, has little or no value in economic analysis. Many environmentalists (for example, who? Add sources) argue that GDP is a poor measure of social progress because it does not take harm to the environment into account. Thus, it is important to find out the real meaning of GDP and its value to economic analysis.
II. Statement of the problem
First , this report intends to find out the standard definition of GDP as well as the measurement of GDP. the definition of GDP will be divided into seven parts in order to study the measurement of GDP more easily. They are “the market value”, ”of all”, ”final”, ”goods and services”, ”produced”, ”within a country”, “in a given period of time”. Then we will talk about the components of GDP, especially the U.S GDP, including consumption, investment, government purchase, and net exports will be discussed. We will look
I. Background
Since 1985, when the State Council of China approved to establish a System of National Accounting (SNA), using the gross domestic product (GDP) to measure the national economy, more and more people are getting familiar to this word. We must have heard about it for countless times. At the end of 2010, China has overtaken Japan as the world's second biggest economy in terms of GDP, which has drawn attention all around the world and has made Chinese people proud of the rapid development over the past decade. However, there are still a large quantity of people in China or even in the world that know nothing about GDP. Moreover, still many people do not fully understand the real meaning of GDP even they have heard about this economic term before. GDP per capita is often considered an indicator of a country's standard of living whereas there are limitations and criticisms against the belief that GDP measures a country’s living standard. Many economists (for example, who? Add sources) argue that GDP is an empty abstraction devoid of any link to the real world, and, therefore, has little or no value in economic analysis. Many environmentalists (for example, who? Add sources) argue that GDP is a poor measure of social progress because it does not take harm to the environment into account. Thus, it is important to find out the real meaning of GDP and its value to economic analysis.
II. Statement of the problem
First , this report intends to find out the standard definition of GDP as well as the measurement of GDP. the definition of GDP will be divided into seven parts in order to study the measurement of GDP more easily. They are “the market value”, ”of all”, ”final”, ”goods and services”, ”produced”, ”within a country”, “in a given period of time”. Then we will talk about the components of GDP, especially the U.S GDP, including consumption, investment, government purchase, and net exports will be discussed. We will look