"If a parent chooses to stay home to look after his or her children, then the "work" involved (producing stable and happy children?) doesn't get counted in the GDP. But if the same parent employs a nanny, then it does. People have pointed out that increasing GDP may simply be an indicator of how quickly we are boosting global warming rather than increasing social welfare: a gas-guzzling, high-emission SUV contributes the same amount to GDP as a thousand bicycles. And so on."
But there are further problems with the measure now that so much online activity involves free goods:
"Take Twitter. It has more than 230m active users, 100m of whom use the service daily to send 500m tweets. Since Twitter was founded, these users have dispatched more than 300 billion tweets. And in exchange for this wonderful service they have paid Twitter precisely £0.00.
Now you may baulk at the idea of tweets being "product", but they are what has turned Twitter into a company apparently worth $24bn. So there's economic value there, somewhere.
...when we eventually find a way of measuring the value of online activity, we might find that the economy has been growing nicely after all."