GDP Is Well-Being! Results in the USA and China - Open Journal of Social Sciences

JSS > Vol.7 No.12, December 2019

GDP Is Well-Being! Results in the USA and China ()

HTML XML

Download as PDF (Size: 349KB) PP. 189-204

DOI: 10.4236/jss.2019.712014 478 Downloads 1,687 Views Citations

Author(s)

Gordon Bechtel

Affiliation(s)

Warrington College of Business, University of Florida, Gainesville, FL, USA.

ABSTRACT

This article quality assures GDP and then links it to well-being in the world’s two largest economies. Despite the global plethora of national indexes, there has been little quality assurance of the unidimensionality of their component indicators. Unidimensional index theory constructs a weighted composite from a 2-level principal components analysis of its several indicators. This weighted composite evaluates its unweighted counterpart, and informs governments about the allocation of resources over its composite indicators. Two axioms predict that weighted and unweighted indexes are perfectly correlated over successive yearly populations in the USA and China. Under these axioms, fractional polynomial regressions of any criterion on these weighted and unweighted indexes perfectly predict this criterion. We confirm the unidimensionality of American and Chinese GDP indexes and their near-perfect prediction of the United Nation’s Human Development Index (HDI). This application discovers that HDI computation can be carried out from a nation’s GDP alone, i.e., without survey sampling, questionnaire interrogation, probabilistic inference, significance testing, or even HDI data.

KEYWORDS

Country Specificity of Fractional Polynomial Regressions, Internal Consistency of Keynesian Indicators, 2-Level Principal Components Analysis, Unidimensional Index Theory, Prediction of HDI from Weighted and Unweighted GDP

Share and Cite:

Bechtel, G. (2019) GDP Is Well-Being! Results in the USA and China. Open Journal of Social Sciences, 7, 189-204. doi: 10.4236/jss.2019.712014.

Journals Menu