Sunday, May 31, 2009

Laconic Question About Japan's GDP Numbers

If the machines stop making other machines, stop consuming electrical power and raw materials, remaining cold and silent...and the companies that own the machines suffer a huge drop in sales but because they are not highly leveraged, simply cut down on company purchases -- should the subsequent huge drop in economic activity recorded in the GDP figures be considered catastrophic, or merely a respite from a frenzy?

1 comment:

Janne Morén said...

GDP is a pretty weird measurement (no shortage of those in economy and other social sciences; stock indices tend to be even worse). GDP per person is better, and PPP-adjusted GDP better still. Still not good, though; I suspects it's still popular and taken seriously simply because it's relatively easy to measure and compare across time and across nations.