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Jul 10, 2024


S1: GDP – calculated as the total market value of all final goods and services produced during a specific time period – has long been used as an indicator of national development and progress. S2: However, critics of this use of GDP contend that GDP is an overly simple measure that neither effectively captures key aspects of human progress nor takes into account negative effects of economic development. S3: Accordingly, these critics have proposed the adoption of alternative measures, two of which are Gross National Happiness (GNH) and Genuine Progress Indicator (GPI).

S4: GNH, developed in Bhutan, is calculated by means of a questionnaire presented to a random sample composed of 8,000 of Bhutan’s citizens. S5: The process involved in calculating GNH is remarkably thorough, with each citizen answering 148 questions on a variety of quality of life-related topics. S6: However, no country other than Bhutan has adopted GNH, in part because of the time and expense required for interviewing a number of citizens sufficient for generating the data required for accurately calculating GNH. S7: A country’s GPI, on the other hand, can be calculated via the use of data that is already widely available. S8: In fact, GPI is in part based on information similar to that used in calculating GDP and differs from GDP mainly in that it is based on not only information on aggregate production but also information on negatives associated with economic growth, such as loss of leisure time and the cost of deterioration of nature and natural resources.

The author of the passage mentions the cost of deterioration of nature primarily in order to

provide an example of why the use of GDP ought to be discontinued

recommend that nations make the preservation of nature a higher priority

show the importance of using additional information beyond aggregate production to measure national development and progress

argue that GPI should be used instead of GDP

cite a specific effect that GDP does not take into account

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