James_K:

"Real" is a term of art in economics. It's used to reflect inflation-adjusted figures because all nominal GDP tells you is how much money is floating around, which isn't all that useful. real GDP may be less certain, but it's more useful.

You're talking about the "real" figures being "less certain," as if there were some objective fact of the matter that these numbers are trying to approximate. But in reality, there is no such thing, since there exists no objective property of the real world that would make one way to calculate the necessary price index correct, and others incorrect.

The most you can say is that some price indexes would be clearly absurd (e.g. one based solely on the price of paperclips), while others look fairly reasonable (primarily those based on a large, plausible-looking basket of goods). However, even if we limit ourselves to those that look reasonable, there is still an infinite number of different procedures that can be used to calculate a price index, all of which will yield different results, and there is no objective way whatsoever to determine which one is "more correct" than others. If all the reasonable-looking procedures led to the same results, that would indeed make these results meaningful, but this is not the case in reality.

Or to put it differently, an "objective" price index is a logical impossibility, for at least two reasons. First, there is no objective way to determine the relevant basket of goods, and different choices yield wildly different numbers. Second, the set of goods and services available in different times and places is always different, and perfect equivalents are normally not available, so different baskets must be used. Therefore, comparisons of "real" variables invariably involve arbitrary and unwarranted assumptions about the relative values of different things to different people. Again, of course, different arbitrary choices of methodology yield different numbers here.

(By the way, I find it funny how neoclassical economists, who hold it as a fundamental axiom that value is subjective, unquestioningly use price indexes without stopping to think that the basic assumption behind the very notion of a price index is that value is objective and measurable after all.)