Denseman on the Rattis

Formerly known as the Widmann Blog

economicsen

GDP

Cynicus Economicus has a very interesting blog posting.

He basically is questioning whether GDP makes any sense when borrowing is high, and especially whether borrowing ever should be measured as a percentage of GDP.

One brief quote, but do read the whole thing:

GDP is just such an idea. It seems to be a perfectly rational and clever idea, that an economy’s output might be measured through the activity in the economy. However, if an economy is being financed in part by debt, the meaningfulness of the measure completely disappears

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