<Li> Measures of GDP typically exclude unpaid economic activity, most importantly domestic work such as childcare . This leads to distortions; for example, a paid nanny's income contributes to GDP, but an unpaid parent's time spent caring for children will not, even though they are both carrying out the same economic activity . </Li> <Li> GDP takes no account of the inputs used to produce the output . For example, if everyone worked for twice the number of hours, then GDP might roughly double, but this does not necessarily mean that workers are better off as they would have less leisure time . Similarly, the impact of economic activity on the environment is not measured in calculating GDP . </Li> <Li> Comparison of GDP from one country to another may be distorted by movements in exchange rates . Measuring national income at purchasing power parity may overcome this problem at the risk of overvaluing basic goods and services, for example subsistence farming . </Li> <Li> GDP does not measure factors that affect quality of life, such as the quality of the environment (as distinct from the input value) and security from crime . This leads to distortions - for example, spending on cleaning up an oil spill is included in GDP, but the negative impact of the spill on well - being (e.g. loss of clean beaches) is not measured . </Li>

Who has defined national income on the basis of consumption