Lawrence Lockhart, John Airs, Peter Wrigley and Jeremy Cushing respond to an article by Dan Button
As an economist I endorse Dan Button’s article( Stop obsessing about GDP: we should focus on wellbeing, 11 June ). The most we can say is that a succession of GDP figures over months should indicate whether the economy is growing or moving into recession. Likewise aggregate GDP statistics tell us nothing about how national fortune and income are distributed: globalisation in recent decades has increased the dimensions of the the cake, but the main beneficiaries have been the already better-off.
To extract meaning from GDP tendencies we have to break it into its components: uptake, investment, public spending, the trade balance. Consumption is by far the largest of these, and the primary motorist of their own economies, but its level is precariously underpinned by unsecured private debt. It is broadly accepted that real investment( in brand-new productive capacity) is dismally inadequate for the continued growth of a modern economy; much of what does take place goes into buying paper assets.
Read more: theguardian.com