Could a range of statistics be used to measure a country’s wellbeing rather than GDP?

GDP is the most widely-used measure of economic activity. There are international standards for its calculation, and much thought has gone into its statistical and conceptual bases. Earlier paragraphs have emphasized some of the important areas where more progress is needed in its computation. As statisticians and economists know very well, GDP mainly measures market production – expressed in money units – and as such it is useful. However, it has often been treated as if it were a measure of economic well-being. Conflating the two can lead to misleading indications about how well-off people are and entail the wrong policy decisions. Material living standards are more closely associated with measures of net national income, real household income and consumption – production can expand while income decreases or vice versa when account is taken of depreciation, income flows into and out of a country, and differences between the prices of output and the prices of consumer products.

The debate title does not state how we are measuring GDP, simply saying GDP. Obviously the GDP of a country in US$ is very unhelpful when it comes to measuring the wellbeing of any individual. A country with a large population can have a big GDP while each individual is still poor. So India has a GDP of 1,206,684 million US$ while luxembourg of only 54,973 million US$[[20008 IMF list http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)]] while in GDP per capita is reversed. Luxembourg US$113,044 and India US$1,017.[[GDP PPP using IMF 2008 http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)_per_capita]] So the GDP per capita is obviously much better at measuring individual wellbeing.

This can be further improved upon by looking at GDP by purchacing power parity rather than in nominal US$. When this is done GDP takes into account how much people can buy in the country they live in so taking into account differences in prices.

This does take into account things like depreciation and the income flows into and out off a country as it is defined as [quote]The total market value of all final goods and services produced in a country in a given year, equal to total consumer, investment and government spending, plus the value of exports, minus the value of imports[[http://www.investorwords.com/2153/GDP.html]] imports[[GDP Definition http://www.investorwords.com/2153/GDP.html]] [/quote]