GDP, otherwise known as Gross Domestic Product, reflects the flow of goods and services a nation produces in a single year. It says nothing about wealth of the country and the wealth of the citizens.
How do you estimate wealth then using GDP? I could be buying goods from other countries but reselling it at a lesser profit due to the high rental cost for example. Where is the supposed wealth?
You might not be able to track wealth easily in other countries, but in Singapore, it's a different case altogether. Why? That's because we have something called the CPF.
It's compulsory for companies to contribute to CPF if your earnings are above a set threshold. Using the estimates from the CPF contributions tells more about the wealth of a nation then the supposed GDP that only tells other countries how good your business can flourish in Singapore.
There's a big difference between companies making money versus citizens getting a decent wage. Unless you have strong labour laws which unfortunately we do not have, profits from businesses do not necessary flow down to all. In fact, it may even flow out of Singapore to enrich others.
If GDP must be used, then the wealth of a nation should also be used in conjunction with the gini coefficient and the percentage of millionaires and HNWI in the population. This will also tell you how much of the supposed actual GDP flow down to the citizens.
It's like the US elections. All the economic indicators are very good. Low unemployment rate, high number of jobs created... But why did the incumbent lose the election? Personally, I think the reason is quite simple. The citizens did not see all this happening at ground zero. If everything is really as rosy as painted, I don't see why the citizens are not voting the incumbent party back to power.
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