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Reader feedback: GDP does not tell the whole story

Re: Budget pleases IMF, and IMF Mikloš, By Beata Balogová, Oct 27 - Nov 2, Vol 9, No 41

The IMF is only concerned with the growth of real GDP. But, variable as real GDP undoubtedly is, it provides misleading information about the Net Economic Welfare (NEW) and standard of living in a country.

The situation is alarming. Slovakia has recorded a decrease in the real wage rate. Unemployment has decreased only [on paper,] due to the altered conditions under which people are excluded from the records of the National Bureau of Labour.

Positive net exports are only caused by the automobile industry, but the automobile market is expected to stagnate or decrease in the future. GDP does not involve the underground economy, corruption, social issues, or health care. Slovakia cannot praise itself for having a high life standard of living for its citizens.


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