Behind GDP Growth: An Illusion of Prosperity or a Manifestation of Strength?
Collecting the latest data, we have witnessed the economic performance of all regions of the country - China's total GDP in 2023 will reach 126 trillion yuan, with an annual growth rate of 52%。However, behind this brilliant report card, there are many people's confusion and worries. The decline in household income and the downward pressure on the economy are in sharp contrast to the increase in overall GDP. How to evaluate GDP, the global economic measure, is the absolute standard for measuring wealth and power?
Historical Survey of GDP and Contemporary Demands.
Historically, there have been two systems that have been spectacular for a time – the Soviet Union based on a rough assessment of the country's prosperity based on gross industrial and agricultural output, and the United States led by the Nobel laureate economist Simon Kuznets's model of GDP statistics, which focused not only on industrial agriculture but also on consumption, investment, and imports and exports.
Doubts and limitations of GDP calculation.
However, many people have discovered the vulnerabilities of the GDP algorithm. In 1973, for example, the Soviet Union's economy was only 42% of that of the United States in terms of GDP, but the Soviet Union was by no means weak. Take farmers as an example: if they eat the food they grow, it is difficult for their GDP to cover it; And it becomes a trading commodity, regardless of the highest level, it can significantly increase GDP. Under a planned economy such as the Soviet Union, where food and clothing were distributed in the form of tickets, consumption indicators were difficult to quantify – this was not a mistake in GDP, but a bottleneck in the planned economy.
Choice of GDP statistics under the dominance of capital.
Today, whether in China or elsewhere, GDP has long been the universal measure of the economy. Behind this, there is a fact: we live in a world defined by capital, and it needs to highlight its importance to economic progress. Simple statistics of industrial and agricultural output do not demonstrate the leading role of capital; GDP exaggerates the influence of capital, and the financial industry naturally stands out as a pillar industry in developed countries.
The profitability of the financial sector is significant, but the agricultural sector is hard to match. The prosperity of the financial industry forms the foundation of a strong country, making financial tycoons increasingly admired and secretly influencing national policy.
The illusion between GDP and the prosperity of small countries.
As a result, although some countries are rich in high GDP on the surface, in fact, they are only relying on industries such as pornography and gambling to temporarily boost economic data. As a result, the potential "strength" is not as strong as the GDP figures suggest, which is one of the reasons why it is difficult for the public to feel happy from GDP growth.
The contradiction between GDP and people's happiness at work.
When it comes to Japan and South Korea, despite their high GDP and per capita GDP, they have entered the ranks of developed countries, but their lives are not easy, with long working hours, long working years, and far less than satisfactory happiness.
GDP is an analogy for the economic blood sugar indicator.
It seems fitting to compare GDP to a "blood sugar indicator" – healthy bodies tend to have normal blood sugar, but blood sugar shouldn't define health backwards. Even in the case of a country's economy, GDP as an indicator should not be the whole story. Luxury goods like LV contribute significantly to GDP, but in some cases, they are far less practical than second-hand AK47s.
Conclusion. Based on the current situation and history, what does this series of GDP data reflect? Busy economic activity does not indicate overall social prosperity, nor does it indicate a surge in people's happiness. GDP, behind a simple number hides complex economic and social relations. In the pursuit of rapid economic development, we should not simply be obsessed with digital growth, but should deeply consider the true value and social significance of economic growth. Perhaps, it is time to rethink the authority of GDP and explore a more comprehensive and integrated measure of the economy.