It’s the economy stupid!

The state of a countries economy is one of the main headline topics in the news these days and it is judged by whether the economy is doing well by growth and stability and its very much a numbers game.  Economic growth refers to an increase in the size of a country’s economy over a period of time. The size of an economy is typically measured by the total production of goods and services in the economy, which is called gross domestic product (GDP). Economic stability definition is a term used to describe the financial system of a nation that displays only minor fluctuations in output growth and exhibits a consistently low inflation rate.

GDP in a country is usually calculated by the national statistical agency, which compiles the information from a large number of sources. In making the calculations, however, most countries follow established international standards. These types of financial measurement are seen and believed to be accurate.

Bigger question to ask might be what’s the point in these stats? How does a growing or stable economy effect our lives? Well in basic terms a growing and stable economy increases an individual living within that economy of having a job and prosperous opportunities to live and have a future.

So what are the strengths & weaknesses to this model and to an economy within this model. Strengths are the measurement are generally accurate and can be updated and corrected if and when needed, when the sums add up a country can be confident that it is doing something right.

Weaknesses of this model relies on growth of an economy as a sign of health and productive economy although a sustainable and environmentally non-destructive economy that provides value to its citizens and environment whilst not necessarily increasing profitability on a spreadsheet can still add tremendous value to its citizens and also enhance the environment of the country and people within that society but this is more difficult to measure on a spreadsheet but invaluable over time. A damaged and dying ecosystem can still be tremendously profitable up to a typing point where then the damage might be so catastrophic that the land or sea has no value or profit to it at all.

Adoption of circular economy principles can help in reducing the negative impact on natural resources as well as damage to our climate.