NEW (Net Economic Welfare):
It has been asserted by several modern economics that national income is not a
satisfactory measure of economic welfare. According to them in order to obtain
a true measure of economic welfare some adjustment both in the form of
additions and subtractions have to be made in the aggregate of national income.
This true measure of economic welfare is now often called “Net Economic
Welfare” or simply NEW.
NEW can be represented by as follows:
NI = Real GNP – Depreciation + value of lea sure +
value of non – market activities – Environment pollution – Regret able costs =
NEW
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