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Development Economics: Evaluate the validity of using National Income statistics as an indicator of standard of living and as a comparison of economic development between different countries. National Income is an indicator of standard of living measured by outp ....

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.... statistic is widely used in the USA and Japan. However, there are some criticisms of National Income statistics. The first major criticism is that of accuracy due to difficulties in the measurement. E.g. Second hand deals go unregistered. The second criticism which is linked to this is that sales in the black economy will also go unregistered even though they may have significant effects (both good and bad) on a personÕs standard of living. For example, if drugs were being sold on the black market this may lead to a rise in crime and so peopleÕs standard of living would fall, however the person selling the drugs would increase their income and ....