Bryan Caplan is an optimist. He thinks that economists do many errors in estimating GDP (overall well-being). He is right in the sense that we are missing many dimensions of welfare improvements in the last half-century (see here, here and here). These errors in measurements lead us to hold incorrectly pessimistic views (such as those of Robert Gordon). However, Prof. Caplan seems to argue (I may be wrong) that all measurements problems and errors are greater than zero. In other words, they all cut in favor of omitting things. There are no reasons to believe this. Many measurement problems with GDP data cut the other way – in favor of adding too much (so that the true figures are lower than the reported ones).
Here are two errors of importance (which are in no way exhaustive): household output and adjustments for household size.
Household Output
From…
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Utopia, you are standing in it! 
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