The Economist's Digest 13

Economic focus Grossly distorted picture
Originally from The Economist. Mar. 15~21th.

Summary:
If we compare Japan ’s GDP growth with the America ’s, it seems that America performs better in recent years; even it was confronted with the credit crisis. However, if we add the influence of the change in population, the number will be different.
Because Japan ’s population has been shrinking since 2005, its GDP growth benefits each person in a rate better than America , which has a growing population. If we use this way to measure the economic growth in other countries, we will find that the growing rate may be different when measured only by GDP growth.
Many countries boasts of their GDP growth, such as Australia and Brazil , yet their GDP per person are lower than Japan ’s. In a chart, many countries’ GDP growth per person, even Japan , is lower than the original GDP growth number------except for Germany , whose account is almost the same. Germany is a country whose population is decreasing because of low birth-rate. However, this is the few nations that really can stay the life standard and economic growth.
Thus, we can’t only take GDP growth as the only sign now; we should see GDP growth per person. Nevertheless, some politicians in USA don’t seem to understand------They still look on GDP growth and take it for the only goal, not knowing their nation is actually in recession. If GDP per person is a better signature, the government should show it to the public.

My opinion:
This article offers a simple and clear view: a new economic sign------GDP per person. I was amazed when I was reading this article because it seems like a very simple idea, but almost no one has used it until recently. It sounds strange.
Actually, there is another problem about the reality of GDP. It’s the bubble economy, which also makes the number of GDP high. GDP growth means the total improvement of a country’s economy. Thus, if this is a developed country, its low GDP growth doesn’t wholly mean the country is becoming worse. On the contrary, the surge of GDP in developing nations doesn’t mean they’re being as good as developed nations.
Even if the number is right, when we misread the meaning of it, the facts behind the number would be distorted.