How real GDP helps us know if we’re ‘better off’ than before
Religion & Liberty Online

How real GDP helps us know if we’re ‘better off’ than before

Note: This is post #71 in a weekly video series on basic economics.

“Are you better off today than you were 4 years ago? What about 40 years ago?”

These sorts of questions invite a different kind of query, says Alex Tabarrok: what exactly do we mean, when we say “better off?” And more importantly, how do we know if we’re better off or not?

To those questions, there’s one figure that can shed at least a partial light: real GDP. In this video by Marginal Revolution University, Tabarrok explains how real GDP is calculated and how it can be used for comparisons.

(If you find the pace of the videos too slow, I’d recommend watching them at 1.5 to 2 times the speed. You can adjust the speed at which the video plays by clicking on “Settings” (the gear symbol) and changing “Speed” from normal to 1.25, 1.5 or 2.)

Click here to see other videos in the Introduction to Economics series.

Joe Carter

Joe Carter is a senior writer for The Gospel Coalition, author of The Life and Faith Field Guide for Parents, the editor of the NIV Lifehacks Bible, and coauthor of How to Argue Like Jesus: Learning Persuasion from History’s Greatest Communicator. He also serves as an associate pastor at McLean Bible Church in Arlington, Va.