However, GDP is not without shortcomings. The essential problem with GDP as it currently stands is that a growing GDP doesn't necessarily correspond to a rise in the population's well-being. GDP estimates the dollar value of all the goods and services the U.S. produces, but more produc

tion does not automatically create a higher standard of living.

GDP treats crime, divorce and natural disasters as economic gain.

GDP ignores the non-market economy of household and community.

One example is military hardware. Some would argue that an increase in weaponry is a bad thing. Likewise, the production of cigarettes may provide jobs in agriculture, manufacturing, retail, and ultimately, as a result of product use, in health care. But those who disapprove of the industry would not say that the resulting flow of money to the economy adds to America's well-being. More production can also result in more pollution and depletion of resources, but the GDP does not account for environmental degradation. One person's economic boon may be another's economic woe.

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