Economic Development
Quiz 1
The Philippines has a fast-growing economy, with a GDP growth rate averaging 6.4 percent
between 2010 and 2019, ranking 19th globally (International Agricultural Trade Report, 2022).
While the Philippines experienced a profound economic decline due to the COVID-19
Pandemic, it eventually recovered due to high domestic demand, an expanding workforce, and a
rapidly developing services sector. Despite the growing Philippine economy, Filipinos still
experience reduced quality of life, health challenges, income inequality, and poor quality of
education. The percentage of Filipinos who stated their lives had worsened grew from 23% in
June 2025 to 32% in a September 2025 study conducted by Social Weather Stations (Mateo,
2025). Also, according to the United Nations Development Programme's Human Development
Report 2025, the Philippines has a Human Development Index (HDI) of 0.720 and has a slightly
lower HDI than the world average of 0.756, ranking 117th out of 193 countries assessed in 2023
(Congressional Policy and Budget Research Department, 2025). This information shows that
evaluating a country's success solely by monetary indicators is inadequate, as a country with
improving GDP may still face economic and social challenges, and that it is more acceptable to
measure a country's success holistically through health and education. Education and healthcare
are vital for enhancing the quality of life, creating a skilled workforce, reducing poverty,
fostering economic diversification, and promoting sustainable tourism in a country (Wisdom
Library,2025).
Firstly, measuring a country's success solely by GDP is insufficient because it focuses only on
economic activity within and outside the country. Gross domestic product (GDP) measures the
overall monetary value of a country's total output of goods and services in a given period. It is
seasonally adjusted to remove quarterly fluctuations due to weather or holidays (Kramer, 2025).
Measuring a country's progress solely by its GDP ignores other crucial aspects of a developed
country, such as health and education. Also, a high GDP in a country does not imply an equal
distribution of wealth among the population. Economic growth does not always benefit everyone
evenly, and if the advantages are concentrated among the few, income inequality may worsen
(Tutor2u, 2024).
Secondly, measuring a country's success solely by GDP is insufficient, as it includes economic
activities that negatively affect human and environmental well-being. Harmful events such as
natural disasters and war increase economic activity because the money spent on repairing
damage boosts GDP, even though they have more negative effects on human health, quality of
life, education, and the environment. The “Broken Window Fallacy” is often used to explain the
problem, as Frédéric Bastiat explains that an event that seems beneficial to a nation's economy
can immediately have negative economic consequences for many others (Beattie, 2025).
Environmental degradation is a negative externality that GDP fails to reflect, as more products
are manufactured, increasing an economy's GDP regardless of the environmental damage they
cause (Kapoor & Debroy, 2019).
Lastly, measuring a country's success solely by GDP is insufficient because it ignores the
importance of healthcare and proper education to its people. The success of a country should not
only be measured by its monetary value, but rather by the condition of the people living in the
country itself. Instead of using GDP to measure a country’s success, it is better to use the Human
Development Index (HDI). Compared to GDP, the HDI is a summary measure of key dimensions
that places a greater emphasis on human development because it takes into account a country's
quality of life, good education, and a decent standard of living, rather than its production
capability, and education and health are regarded as equally important to a country as economic
strength (ourworldindata, n.d.). Education and healthcare play a vital role in a country's
development and economic growth. Countries with strong educational systems and high literacy
rates are more prosperous than those without proper education, and an educated workforce is
more productive, boosting the country's GDP and reducing poverty (SD University Center,
2024). Well-functioning healthcare systems are crucial contributors to better medical conditions
and human well-being because they are central to the economy's effective functioning, increase
labor supply and productivity, and provide a significant source of employment by producing
goods and services that directly contribute to economic growth (World Health Organization,
2021).
In conclusion, a country must adopt a holistic approach to healthcare and education to properly
assess its progress and success, since GDP measures only economic activity. It is inappropriate to
use GDP alone to gauge a nation's success because it considers only economic activity, both
domestically and internationally, ignores the value of healthcare and education for the populace,
and includes economic activity that has a negative impact on human and environmental
well-being. A holistic approach to healthcare and education evaluates the true development and
quality of human life, ensuring that growth creates a sustainable future rather than merely
consuming resources or correcting avoidable harms, whereas GDP measures only the volume of
transactions, independent of their causes. A country cannot be considered successful if the
people are struggling with health challenges, insufficient education, and a poor quality of life.
REFERENCES
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Congressional Policy And Budget Research Department. (2025). FF2025-64: HUMAN
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International Agricultural Trade Report. (2022, June 8). High growth potential for U.S.
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