Does the national income figure accurately reflect the living standard of a population?

national income statistics are very useful as living standards are measured using GDP per capita. The higher the GDP per capita the better the living standards.

However, national income statistics are subject to a number of drawbacks which make its usefulness debateble in economic practise.

1. NY Statistics do not take into account the opportunity cost of high production that is leisure time forgone.

2. GDP per capita figures do not take into consideration negative externalities generated from economic development e.g pollution.

3. It does not take into account condition of work e.g doctor patient ratio.

4. Composition of NY that is, GDP may be high because of increased government spending on amunation which does not improve living starndards.