Question

As you read the chapters and review the videos, reflect on all the activities and services people engage in that have no market price. Write a two-page paper analyzing whether there should be a market value for these activities and services, and how you would change the GDP measurement to incorporate that value - including taking account of inflation. Look up the various attempts to do this. Support your analysis with appropriate sources.

Answer 1

GDP as term was dedined by by William Petty in 1652 which had basic concept to attack landlords against unfair taxation and Charles Devenant further developed the terminology in 1695 as per Wikipedia Sources.

References

Coyle, Diane. "Warfare and Invention of GDP."The Globalist. Retrieved August 1, 2015.

The above method was then more developed and redefined t after Bretton woods system crashed in 1944.GDP was then used main tool for calculations of economic progress.

The method drew huge flak as well as criticism because it did not account for environmental damage as well as income earned due to unpaid work.

These shortcomings were then incorporated by Amartya Sen as Nobel Prize In Economics Awarded in 1980.

GDP Calculations use various models like backdated propogation where inflation is generally unaccountable and hence is inefficient model.

The best used model is the Production approach.

​​​​​​In This the gross value added and gross consumption is taken which thus accounts for unpaid work as well as inflation indexing and gives fair estimate of nations GDP.

An equivalence to GDP is The United Nations Hukan development index which forms revolutionary approach to measurements of nations progress and accoubts for gender equality, education and health.

GdP Per Capita in Nominal Terms and GNI are other important tools which form complement to GDP and fair estimated value of economic progress .