Gross Domestic Product and Policies Ensuring Its Accessibility: Theoretical Aspect

Abstract

The article “Gross Domestic Product and Policies Ensuring Its Accessibility: Theoretical Aspects’’ seeks to highlight the importance of using Gross Domestic Product (GDP) as a macroeconomic indicator for assessing living standards, and to evaluate the extent to which GDP growth corresponds to the welfare of the majority of society. The study demonstrates that these two variables—GDP and living standards—frequently diverge, thus necessitating the consideration of additional determinants. An important task in this regard is to establish a link between the producers of statistical information and its users in relation to macroeconomic indicators.

The research methodologies are general scientific approaches, theoretical analysis, and logical reasoning which confirms that although GDP is a crucial measure of economic activity, its accessibility diminishes alongside rising inequality within a country. The divergence between the statistical measurement of economic indicators and their societal perception has specific causes. In our opinion inequality represents the most significant factor. Therefore, GDP per capita does not provide an accurate reflection of the living standards of most of the population. Accordingly, other variables of living standards must be considered, among which the degree of inequality in society has primary importance.

To this end, the article emphasizes two key economic instruments: tax policy and guarantees of minimum income (minimum wage). In particular, we recommend  a progressive taxation system and the establishment of a minimum wage in the country. These instruments are regarded by us as essential tools for mitigating income inequality, thereby allowing GDP, as an indicator of economic activity, to reflect more accurately the welfare associated with its growth. Focusing on economic policy in this direction will enhance the accessibility and relevance of GDP as a macroeconomic indicator.