Agree with the diagnosis, but not with the solution

See article in the Economist on the “problems” with measuring prosperity with GDP.

How to measure prosperity

All valid observations IMO.

Don’t necessarily agree with the proposed “solutions”.

Happy reading.

IAS

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7 Responses to Agree with the diagnosis, but not with the solution

  1. a happy little debunker

    Moving from the ‘production’ methodology to a common ‘basket of goods’ methodology makes sense.

    There are several, with one of the most noted being the Big Mac Index – but these have flaws as well.

  2. Art Vandelay

    People still read the Economist?

  3. tgs

    People still read the Economist?

    Haha, reckon.

    GDP is a perfectly good measure of what it is supposed to measure. People who rail against it as not being a good measure of human happiness or whatever the current crop of social science PHDs are waffling on about now are just stupid.

  4. Lem

    This new metric—call it GDP-plus—would begin with a long-overdue conceptual change: the inclusion in GDP of unpaid work in the home, such as caring for relatives.

    What about if we are all out of work, the economy has collapsed and business has folded, so all we do all day is sit around at home looking after relatives. Is that a positive for GDP or a negative?

  5. Pusnip

    Ho hum, this is such old news.
    Kuznets pointed out that GDP was not a welfare measure in 1934, when he invented it.
    John Stone at the Australian Treasury pointed out that GDP is not a welfare measure in a couple of papers in the 60s and 70s.
    Fred Argy and then the National Competition Council said the same thing in the 90s.
    But here we are again, another couple of decades on, with the same straw economic man being resurrected, zombie like.
    Do we really need to debunk this nonsense again?

  6. Lem

    Do we really need to debunk this nonsense again?

    Apparently so. Life now is like a scene in The Walking Dead.

  7. JohnA

    tgs #2021055, posted on May 5, 2016 at 6:06 pm

    People still read the Economist?

    Haha, reckon.

    GDP is a perfectly good measure of what it is supposed to measure. People who rail against it as not being a good measure of human happiness or whatever the current crop of social science PHDs are waffling on about now are just stupid.

    Is that a variation on the IQ Test, which is a successful measure of how well people perform on … the IQ Test?

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