Is a High GDP Good?

Is a High GDP Good?

Economists view a high gross domestic product as one of the best indications that a country is in good economic health, showing a high level of economic production. However, typical citizens may relate better to other measures of economic prosperity that have a direct impact on their daily lives.

There are risks when a country's GDP grows rapidly for several successive quarters. Consistent gains of more than 4 percent may signal an overheating economy or a situation in which certain assets are setting up to face a bubble. Companies and investors may invest too much money in developing opportunities only to experience major crashes or losses when conditions sour.