Suppose a woman marries her butler. After they are married, her husband continues to wait on her as before, and she continues to support him as before (but as a husband rather than as an employee). How does the marriage affect GDP? How should it affect GDP?

Expert Answers

An illustration of the letter 'A' in a speech bubbles

The GDP will drop ever so slightly because the amount of money being exchanged for goods or services within the nation drops. Though the same amount of work is being performed, and everything else about the situation remains essentially the same, the monetary portion of the exchange has been removed. Doing this changes the GDP.

The Gross Domestic Product measures the amount of income and money that is exchanged within a nation. While the butler was employed, he was earning a set living—paid directly by the woman. However, when the two are married, while he retains his duties essentially, and also still has just as much income (if not more, since he now has more free access to his wife's estate), the money being exchanged for his work is removed from the economy—his salary is gone, and therefore the overall earnings of the citizens in the nation drops slightly.

This problem is a twist on a classic hypothetical scenario in economics in which a man marries his maid. It is designed to...

(The entire section contains 3 answers and 603 words.)

Unlock This Answer Now

Start your 48-hour free trial to unlock this answer and thousands more. Enjoy eNotes ad-free and cancel anytime.

Start your 48-Hour Free Trial
Approved by eNotes Editorial Team

Posted on

An illustration of the letter 'A' in a speech bubbles
Approved by eNotes Editorial Team

Posted on