 On the Methodology of the Economic Freedom of the World IndexRobert A. Lawson Chapter Chapter 9 in The Design and Use of Political Economy Indicators, 2008, pp 171-185 from Palgrave Macmillan Abstract: Abstract Anyone who has taught macroeconomics knows that students sometimes have difficulty grasping the enormity of the concept of GDP. The usual definition given is, “the market value of all final goods and services produced in a nation in a year,” and a number, $13,620 billion according to the latest estimate (Bureau of Economic Analysis 2007). But what does it mean? It is just a number to them. To make it seem more concrete, I ask my students to imagine a long printout that lists every activity in America this year: production of 10 million cars, 1.2 billion haircuts, 2430 major league baseball games. Then I ask them to imagine the same printout but with dollar values instead of quantities: $200 billion worth of cars, $12 billion in haircuts, $2 billion in ticket sales at major league games. Finally I ask them to imagine adding up all the numbers. Slowly it dawns on them what we are talking about. Clearly the total production of the United States is a big, multidimensional thing and GDP boils it down to a single, mind-bogglingly huge number. Keywords: Economic Freedom; Hard Data; World Economic Forum; Corruption Perception Index; Heritage Foundation (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-61662-2_9 Ordering information: This item can be ordered from Access Statistics for this chapter More chapters in Palgrave Macmillan Books from Palgrave Macmillan |
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