LG's example goes to methodology, but if the prevalence of such
transactions is limited,
it doesn't amount to much. More to the point is the neglect of
non-market amenities.
GDP is supposed to measure value of production, nothing more. It
probably does that
as well as can be done. Its use as a measure of well-being is a
political matter in which
economists are complicit.
There is no "hedonic GDP" that I'm aware of. There are different price
indices that
can be used to deflate nominal GDP to get "real" measures. The
difficulty of measuring
real computer prices should be clear. Again, the question is whether
there are better
ways of dealing with it, assuming you want a value of production measure.
Laurent GUERBY wrote:
The more a country does "stupid" things, the bigger its GDP is. USA paid
advertisment is 2% of GDP, world average 1%, USA direct litigation cost
2% of GDP, with estimated indirect effects at 6% of GDP, polluting
then litigating and cleaning, unhealthy food then health care.
All of these are really money running quickly in closed circles with
really small "value" but big GDP impact.
BTW, I've read somewhere than when a computer is bought for
$1000 in the USA it is counted as much more than $1000
in USA GDP ("hedonic GDP") and that this doesn't happen
in other countries. Anyone knows wether it's true or
false and a definitive reference on this?
Thanks in advance,
Laurent
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