An important guide to understand in depth our economic model

The propose of this post is show n depth how GPI (Genuine Progress Indicator), EF (Ecological Footprint) and GDP (Gross Domestic Product) are combined with each other. Also is important for us to see how these factors are changing throughout the years.

   Ecological Footprint is the amount of the productive land and recourses that are needed to sustain a population in the earth’s ecosystem. It also counts many factors such as income, agriculture and of course energy which are extremely vital everyday for the humankind. Gross Domestic Product is the market value of all finished goods and services produced in a country per year. The standard of living in each country is represented by the GDP. Genuine Progress iIndicator is a factor or let’s say better an indicator that is actually used to measure the economic growth of any particular country. GPI in other words measure the country’s growth which can be an increasing in a production of goods, and  also expanding services that have actually resulted to the increasing welfare of the citizens  in a certain country. GPI claim that actually can be more reliable in the measurement of economic progress as it distinguishes between main economic growth and uneconomic growth. GPI summarizes more forms of economic activity than GDP. The basic difference between GPI and GDP is that Genuine Process Indicator looks at economic activity from the perspective of the impact that it has on the individuals and society as a whole, while GDP pays more attention to the economical point of view. Therefore, another difference in these two measures is that under GDP crime and pollution are seen as income in terms of generating crime rates and having pollution as a result of producing more, while on the other hand GPI sees these two as costs. As a result, GPI calculates the environmental costs which actually make the GPI “greener” than the GDP.

Table 1 US GDP vs GPI

Component of GPI	US total in 1950(trillion of dollars)	Per capita in 1950(thousands of dollars)	US total in 2004(trillion of dollars)	Per capita in 2004(thousands of dollars)
GDP	1.153	0.132	7.589	0.254
Benefits	1.041	0.014	4.746	0.0617
Environmental costs	0.407	3.74	3.990	0.0734
Social and economic costs	0.476	0.319	3.926	0.0746
GPI	3.077	0.839	20.251	0.4637

1) In 2004 the GDP was 6,58 times greater than it was in the 1950. The same time GPI increaed by 3,4 times. As a result from this we see that GDP and GPI have icreased both.1)  How many times greater was the GDP in 2004 than in 1950? By how many times did the GDI increase between 1950 and 2004? What does this comparison tell you?

In 2004 the GDP was 6,58 times greater than it was in the 1950. The same time GPI increased by3,4 times. As a result from this we understand that GDP and GPI have increased both.

2)  By how many times, respectively, did benefits, environmental costs, and social and economic costs increase between 1950 and 2004? How are trends in each of these components driving the overall trend between the GPI and the GDP? Which component has gotten worst over the years? How would you account for these trends?

The benefits have been increased 4.599, the environmental costs by 9.803 and the social and economic costs had been increased by 8.247 between 1950 and 2004. So,  from 1950 to 2004 GPI and GDP had been increased. The environmental costs had been increased.

3)  There are many ways to define and measure the various types of benefits and costs that go into the GPI. How do you think a person with a biocentric worldview would measure these differently from a person with an anthropocentric worldview? Whose GPI for the year 2005 would likely be higher?

A biocentric person sees the world and to be more exactly the (bio) “life” as the center of everything  while on the other hand the anthropocentric worldview of a person makes hi to see the humans as the very center of everything. The anthropocentric worldview comes in a big contrast with the biocentric worldview.

4)  Now consider your own life. Very roughly, what would you estimate are the values of the benefits, environmental costs, and social and economic costs you experience? What could you do to help improve these trends in your own personal accounting?

My  life  up to this point made some very bad lets say habits. I’m saying this because my ecological footprint is vary big.  We all have to understand that this way of living will actually make us to regret it in the future.  The only thing I have to do is to try to be more realistic in my opinions I my future life, because these opinions will consequence many life’s n the future.

References :

GPI definicion from: http://www.uvm.edu/giee/Page=genuine/index.html&hl=el&biw=1440&bih=805&source=hp&q=Genuine+progress+indicator&aq=f&aqi

Withgott, J. & Brennan, S. (2011). Environment: The Science behind the Stories. 4th Edition, San Francisco: Pearson Education .

Picture 2, from : http://www.kinima.org/sites/default25:429,r:14,s:25&biw=1440&bih=805

Picture 1 ,from : http://ecology.com media/bff/img/fp-tZ