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Beyond GDP

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Beyond GDP

Measuring What Matters

World Economic Forum,

5 min read
3 take-aways
Audio & text

What's inside?

Gross domestic product – a well-known metric of economic activity and prosperity – needs a revision.

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Editorial Rating

8

Qualities

  • Eye Opening
  • Overview
  • Concrete Examples

Recommendation

As the world economy changes, so too must the tools used to measure it. GDP is a telling example, capturing economic growth and employment but not the quality of human life or of the environment. Economists and public policy experts Natalie Pierce, Peter Vanham, Diane Coyle and Girol Karacaoglu look at the big picture in this instructive episode of the World Economic Forum’s Stakeholder Capitalism podcast. Their enlightening discussion showcases how some countries are tackling the messy problem of economic measurement.

Summary

Gross domestic product is a universal gauge of a nation’s economic success. Yet it fails in several respects.

The desire to understand the workings of a nation’s economy originated during the Great Depression, but World War II furthered the development of the metric known as the gross domestic product. The US and UK governments wanted to understand how much output was possible for the war effort and at what cost to citizens’ consumption and savings. The United Nations later adopted GDP as a standardized indicator of economic progress, comparable across countries. 

But GDP has some serious shortcomings in that it fails to consider the health of the environment...

About the Podcast

The World Economic Forum’s Natalie Pierce and Peter Vanham cohost the Stakeholder Capitalism podcast. Diane Coyle is a professor of public policy at Cambridge University. Girol Karacaoglu is head of the School of Government at Victoria University in New Zealand.

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