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Economic development - Coggle Diagram
Economic development
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Standards of living
GDP and GDP per head was thought of good ways to measure standard of living.
Higher figure = standard of living were increasing (more to be shared by the people in the country)
three criticisms of using GDP as an indicator :
- Doesn't include 'hidden economy'
- Doesn't include income inequality
- Real GDP per capita focuses on materials aspects
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Case study answers:
- China has strong industrial production and high manufacturing exports
- Increase GDP = well economy
- Only measures the total value of goods produced in an economy in a given period of time, only focusing on the output and not on the individuals.
- Measuring GDP is a good way to measure economic growth, however comparing living standards in different countries could be improved. As not all goods and services will go through a market, especially including the "hidden economy". With this knowledge how can we truly measure standards of living.
Definition: level of material comfort which people are able to enjoy in terms of goods and services which they can use or buy
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