gdp calculations

[birdseye]

We have recently had a 1.5% upgrade in our GDP thanks to the ONS using a different estimate for " health care productivity."  That puzzles me because I would have thought that health care, unless we sere selling it to foreigners as a stand alone, would be much like maintenance in a factory. Something essential to allow the factory to wrok but not affecting tirnover aka gdp.

That begs the question of all the other "head office" services - the civil service for example, government, education ( of the workforce not foreigners) etc.

If we include all these in gdp, does the resulting number mean anything? I had always thought that GDP was the sum of all the goods and services we made and sold to people.

[leftieliberal]

Sept 19, 2023 16:21:21 GMT birdseye said:

We have recently had a 1.5% upgrade in our GDP thanks to the ONS using a different estimate for " health care productivity."  That puzzles me because I would have thought that health care, unless we sere selling it to foreigners as a stand alone, would be much like maintenance in a factory. Something essential to allow the factory to wrok but not affecting tirnover aka gdp.

That begs the question of all the other "head office" services - the civil service for example, government, education ( of the workforce not foreigners) etc.

If we include all these in gdp, does the resulting number mean anything? I had always thought that GDP was the sum of all the goods and services we made and sold to people.

www.bankofengland.co.uk/explainers/what-is-gdp

[lens]

I've always thought GDP was a flawed metric, but it's a question of "if not GDP, then what?" It comes out of a desire to quantify everything, no matter whether the result is really useful.

First off, if it was to rise by (say) 2% in a year, I'm sure politicians would hail it as good - but what if the population rose by 4% in the same period? Such would mean everybody would (on average) then be WORSE off - exactly the opposite to what might be inferred by GDP.

And following on from birdseye's point, then my understanding is that it can include factors which are in reality BAD for the average citizen. So if a disaster did huge damage, the effort involved in recovery would positively inflate GDP, even if the end point is just back to where things were before, in spite of massive spending.

[birdseye]

Interesting where you end up with a link. I got diverted into "legal tender" to find that " In Scotland and Northern Ireland it’s only Royal Mint coins and not banknotes." that are legal tender.