Answer to Question #173287 in Macroeconomics for Samantha

Question

 Suppose a man marries his maid. After they are married, his wife continues to perform the home duties as before, and he continues to support her as before (but as a wife rather than as an employee). How does the marriage affect GDP? How should it affect GDP?

Answer 1

When women marry her butler, if we assume that butler no longer works for that family, then GDP will fall. Reason for the fall is that a butler will no longer receive the salary, and that category will not exist any more in GDP calculation since GDP calculates total value of all goods and services. Butler services no longer exist so the end result will fall of GDP.

After they are married, he will continue to wait on her but that service will not be part of GDP, since not all goods and services are part of GDP. GDP does not measure household chores so his services are not contributing to the economy when we look from the perspective of GDP.