GDP no longer a good measure of well-being

A nation’s economic prosperity is an “insufficient” measure of its overall good health, a conference in parliament was told.

Other factors, such as efforts to tackle climate change and social disorder, should also be taken into account, the event heard.

The two-day conference, ‘Beyond GDP’, was opened on Monday by European commission president José Manuel Barroso.

Partly organised by parliament and the commission, it has attracted over 600 participants from the economic, environmental and social sectors and is designed to move towards a better appreciation of what progress, wealth and well-being actually are.

One of the keynote speakers, Swedish centre-right deputy Anders Wijkman said, “Clearly, GDP is important and most of us want to see economic growth.

“But there has to be more to a nation’s well-being than just its economic prosperity. The time has come to look at other indicators which might tell us what is going in society, such as the environment.

“In time, these should become just as important as GDP is today.”

His comments were echoed by another participant, Dutch Independent MEP Hans Blokland, who said, “No-one is suggesting that we no longer use GDP as a measure.

“Rather, I am saying that social and environmental issues in measuring economic growth should be integrated into one system”.

Parliament’s president, Hans-Gert Poettering,  said, “Major negative effects of globalisation such as climate change pose new risks to our entire economies. That is why new indicators of wealth are needed.”

Paul Allin, of the UK Office for National Statistics, said, “It is all well and good to say we should consider other indicators but the question is: what should these be?

“That is why an event like this is so important as it will help us identify some of these additional dimensions.”

Speaking on Monday, environment commissioner Stavros Dimas said, "The maxim that we need to 'measure what matters' has grown increasingly important over the years.

"Never before has so much information been availlable on such a wide array of topics.

"My hope is that this conference will be an important catalyst for the work to come in improving our measures of progress, true wealth and the well-being of nations."

The EU is now developing indicators that would measure environmental progress to improve policymaking. A preliminary version is due to be operational by 2009.

* GDP is the gross domestic product of a country. It measures the total final market value of all goods and services produced within a country during a given period.

 

 

• Previous article
• Next article