Supplementing Per-Capita GDP as Measure of Well-Being

Source: Robert H. Frank, Johnson Graduate School of Management, Cornell University, 2011

A society whose primary published index of economic well-being is per-capita GDP will inevitably tilt its policies in the direction of promoting growth in this index, even at the expense of other factors known to promote well-being. That per-capita GDP is an imperfect index of economic welfare is not news. The lesson of recent work is that its weaknesses are more serious than many believe. Two particularly important shortcomings are that it takes no account of distributional issues in well-being, nor does it consider how long citizens must work to generate a given level of per-capita GDP. I propose an easily calculated supplement to the traditional per-capita GDP reports that sidesteps both shortcomings.
Related:
Gauging the Pain of the Middle Class
Source: Robert H. Frank, New York Times, April 2, 2011

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