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Development: Time to Leave GDP Behind
Authors: Robert Costanza, Ida Kubiszewski, Enrico Giovannini, Hunter Lovins, Jacqueline McGlade, Kate E. Pickett, Kristín Vala Ragnarsdóttir, Debra Roberts, Roberto De Vogli, & Richard Wilkinson.
Gross domestic product is a misleading measure of national success, measuring mainly market transactions and ignoring social costs, income inequality and environmental impacts. Yet, despite this, since the end of the Second World War it has been the primary national policy goal in almost every country.
A plethora of experiments have produced alternative measures of progress, many of which effectively integrate current knowledge of how ecology, economics, psychology and sociology interact to better reflect wellbeing. The genuine progress indicator (GPI), in particular, is a key tool in assessing the importance of income inequality to progress in living standards, reflecting the fact that a dollar’s worth of increased income to a poor person boosts welfare more than a dollar’s worth of increase income does for a rich person.
While there is board agreement that global society should strive for a high quality of the life that is equitably shard and sustainable, GDP remains entrenched. The formulation of the UN Sustainable Development Goals, due to be announced in 2015, provides a concrete opportunity to develop a measure of progress that better reflects income inequality, wellbeing and sustainability. In order to do this, the SDG process can and should be expanded to include comprehensive and integrated measures of sustainable wellbeing. The importance of this cannot be under estimated. Indeed ‘it is often said that what you measure is what you get’. Building the future we desire, therefore, requires that we measure what we want, remembering that it is ‘better to be approximately right than precisely wrong’.
Full journal article can be read here.