Economic growth is widely associated or even equated with prosperity, and in light of the current crisis the topic is receiving a lot of attention: After all, the crisis not only resulted in the most pronounced downturn since World War II, for many it also cast doubt on the path of economic activity once the crisis is over.
Nevertheless, if we wish to make a sound and comprehensive judgement it is not advisable to look only at current gross domestic product (GDP). Economic growth is a concept that embraces a longer-term perspective and we would be well advised to look beyond the current crisis. The concept of potential output permits a calm and objective view of the matter.