of 25
8/7/2019 GDP AND GNH
1/25
BYD.ASHOK
Alternative measures of GDP
8/7/2019 GDP AND GNH
2/25
8/7/2019 GDP AND GNH
3/25
Income Approach
This method measures GDP by addingincomes that firms pay households for the
factors of production they hire- wages for
labour, interest for capital, rent for land andprofits for entrepreneurship.
Total factor income = Employee compensation + Corporateprofits + Proprietor's income + Rental income + Net interest
8/7/2019 GDP AND GNH
4/25
Expenditure approach
In economies, most things produced are
produced for sale, and sold. Therefore,
measuring the total expenditure of moneyused to buy things is a way of measuring
production. This is known as the expenditure
method of calculating GDP.
G D P = C + I + G + ( X - M )
8/7/2019 GDP AND GNH
5/25
8/7/2019 GDP AND GNH
6/25
The product approach
The product approach measures economicactivity by adding the market values of
goods and services produced, excludingany goods and services used up in
intermediate stages of production. This
approach makes use of the value-addedconcept.
8/7/2019 GDP AND GNH
7/25
NOMINAL GDP TOP 10 COUNTRIES
8/7/2019 GDP AND GNH
8/25
Per capita gdp
1 Qatar 88,232 2 Luxembourg 80,304
3 Singapore 57,238 4 Norway 52,238 5 Brunei 47,200 6 United States 47,123 7.Hong Kong 45,277
8 Switzerland 41,765
9 Netherlands 40,777 9 10 Australia 39,692 10
127 India 3,290
8/7/2019 GDP AND GNH
9/25
Is GDP a satisfactory
measure of growth?
Paul Samuelson, Nobel Laureate and author of
many textbook references, once described GDPas truly among the great inventions of the 20thcentury, a beacon that helps policymakers steerthe economy toward key economic objectives.
8/7/2019 GDP AND GNH
10/25
NEED FOR ALTERNATIVE
MEASURES?
Wealth distribution
Non-market transactionsUnderground economy
Non-monetary economy
Quality improvements and inclusion of newproducts
What is being produced
8/7/2019 GDP AND GNH
11/25
CONTINUED..
Externalities
Sustainability of growth
Quality of life Unpaid labor
Intangible valuables (e.g. feeling secure)
Real Savings
Standard of Living
Uneven inflationary price changes (e.g. ahousing bubble)
8/7/2019 GDP AND GNH
12/25
How to measure ?
developed country
advanced country,
industrialized country, more developed country (MDC),
more economically developed country
(MEDC), Global North country, first world country,
and post-industrial country
8/7/2019 GDP AND GNH
13/25
Definition
Kofi Annan, former Secretary General of theUnited Nations, defined a developed country asfollows: "A developed country is one that allows
all its citizens to enjoy a free andh
ealth
y life in asafe environment."[
But according to the United Nations StatisticsDivision,
There is no established convention for thedesignation of "developed" and "developing"countries or areas
8/7/2019 GDP AND GNH
14/25
8/7/2019 GDP AND GNH
15/25
8/7/2019 GDP AND GNH
16/25
Concept GNH (WELL BEING) ?
coined in 1972
BY Bhutan's former King Jigme Singye
Wangchuck Karma Ura, developed a sophisticated survey
instrument.
Th
e Canadian - Mich
ael Pennock- "de-Bhutanized" version
8/7/2019 GDP AND GNH
17/25
GNH index
GNH indicators include both objective and
subjective dimensions of life.
objective conditions
-educational
- medical facilities room ratios etc
8/7/2019 GDP AND GNH
18/25
SUBJECTIVE
less crime,
illness,
air pollution ETC..
King has said that a GNH society means the
creation of an enlightened society in whichhappiness and well-being of all people and
sentient beings is the ultimate purpose of
governance.
8/7/2019 GDP AND GNH
19/25
GNH VARIABLES
PSYCOLOGICAL INDICATORS
EDUCATIONAL INDICATORS
TIME USE INDICATORS
ECOLOGY
CULTURE
COMMUNITY
HEALTH
LIVING STANDARDS,GOOD GOVERNECEETC.
8/7/2019 GDP AND GNH
20/25
METHODOLOGY
SCREENING
SCREENING QUESTIONS
CALCULATION
NEGATIVE,UNCERTAIN,NEAUTRAL,POSITIVE
SCOREING
SENTTO PROJECT SECTORS REGULATORYBODIES
8/7/2019 GDP AND GNH
21/25
8/7/2019 GDP AND GNH
22/25
RANKING OF GNH ?
India is the 90thhappiest country in the
world, behind Bhutan(13), China(31), Sri
Lanka(13) and Bangladesh
(41). It is ah
ead ofPakistan(112) and Russia(172).
8/7/2019 GDP AND GNH
23/25
8/7/2019 GDP AND GNH
24/25
FUTURE GROSS HAPPINESS
INDEX 1. Economic Wellness
2. Environmental Wellness
3. Physical Wellness 4. Mental Wellness
5. Workplace Wellness
6. Social Wellness 7. Political Wellness
8/7/2019 GDP AND GNH
25/25
THANKYOU
