ABSTRACT
This chapter looks at the limitations of and alternatives to Gross domestic product (GDP) as a measure of well-being in order to place discussion of GDP "in context" with broader discussion of well-being. GDP is the metric that is most often cited to assess overall economic performance. Economic growth traditionally defined as increasing GDP is a statistic that is closely followed by policy makers and the media. Inflation, or the growth rate of prices, is another of the macroeconomic statistics that is considered most significant. Price indexes are interesting both for how they relate to calculation of real GDP and on their own because of their relevance to the policy interest in measuring inflation. An index number measures the change in magnitude, in this case the price level, compared to another period.
