Gross Domestic Product GDP

The Gross Domestic Product (gross domestic product) of a landed estate is commonly defined as the total market value of completely final goods and services produced in a country in a given year. The fact that it is measured regularly and quite consistently in lots all countries of the world allows a direct comparison of the standard of living in individual countries. The frequent measuring also makes it possible to quickly disclose changing trends. For example, it is used to determine whether an economy is growing faster or slower than in the previously measured period and to compare it with other economies in the world.When GDP is calculated in relation to the population of a country, one speaks of the aver sequence GDP per capita. This is often used as an indicator of a countrys standard of living. However, as a measure of the standard of living in a country, GDP has its limitations and shortcomings. ? It does not differentiate between economic turnout that actually benefits th e population and economic bads in a country, such as, for example, expenses for warfare, pollution-producing industries, etc. It does not include unreported activities such as illegal trading or black-market labour. ? It does not reflect non-market activities such as unpaid housework, childcare, and care for the elderly at home, community services or similar activities.The distribution of wealthiness within a country can be truly uneven. When there is a high concentration of enormous wealth in a very small group, and the vast majority of a population is very poor, the average income may be relatively high, although the standard of living of the majority population is low. GDP can only measure the material standard of living, without taking into account the quality of life as perceived by each individual, which cannot be like across a population or countries. ? Economic output can increase due to technological advances requiring less employment, thereby decreasing the employment r atio. ? The age distribution within a country may be such that a relatively small group of working-age people have to support a large group of old people, resulting in a lower employment rate and consequently a lower standard of living.