Why Net Domestic Product Should Replace Gross Domestic Product as a Measure of Economic Growth

Roland Spant ()

International Productivity Monitor, 2003, vol. 7, 39-43

Abstract: In the third article, Roland Spant, a Swedish trade union economist, argues that Net Domestic Product (NDP) should replace GDP as a measure of economic growth for a number of purposes. The key difference between GDP and NDP is depreciation. With the shift in investment toward information technology assets with relatively short service lives, the share of depreciation in GDP has increased in most OECD countries and GDP growth now exceeds NDP growth. Spant points out that this means that the use of GDP leads to the overestimation of real output growth as well as the potential for noninflationary real wage gains.

Keywords: Net Domestic Product; Alternative Growth Measurement; GDP; Depreciation; Capital Consumption; Service Life; Sustainable Growth; ICT; Information; Communication; Technology; Assets (search for similar items in EconPapers)
JEL-codes: E22 O30 O47 (search for similar items in EconPapers)
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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http://www.csls.ca/ipm/7/spant-f.pdf version en francais, pp:46-51 (application/pdf)

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