GDP and Quality of Life Measuring What We Care About The Center for the Advancement of the Steady State Economy.

GDP and Quality of LifeMeasuring What We Care About

The Centerfor the

Advancementof the

Steady State Economy

• History of economic growth and GDP

• Critical view of GDP

• Alternative measures to supplement GDP

• Recent initiatives

• Barriers to change

• Path forward

Outline

What Is Economic Growth?

What Exactly Is GDP?

GDP = C + I + G + (X-M)

History of Growth in GDP

World GDP (1990 millions of dollars)Source: Angus Maddison

History of Growth in GDP

Average World GDP per Capita (1990 dollars)Source: Angus Maddison

Policy on GDP Growth

• History of economic growth and GDP

• Critical view of GDP

• Alternative measures to supplement GDP

• Recent initiatives

• Barriers to change

• Path forward

Outline

Critique of GDP

GDP and Happiness

HappinessIndex

Income per Person ($)

Source: Inglehart andKlingemann(2000)

• History of economic growth and GDP

• Critical view of GDP

• Alternative measures to supplement GDP

• Recent initiatives

• Barriers to change

• Path forward

Outline

What is Quality of Life?

Ingredients:Subsistence, Reproduction,Security, Affection, Leisure,Understanding, Participation,Spirituality, Creativity,Identity, Freedom

Human Needs Soup

Opportunity

Natural CapitalSocial Capital

Human CapitalBuilt Capital

Perception

U.N. Human Development Index

Ecological Footprint

Source: Global Footprint Network

Genuine Progress Indicator

$10,000

$20,000

$30,000

$40,000

1950 1960 1970 1980 1990 2000

GDP per Capita

GPI per Capita

U.S. GPI per Capita Source: Redefining Progress

Calvert-Henderson Indicators

• Education• Employment• Energy• Environment• Health• Human Rights• Income• Infrastructure• National Security• Public Safety• Recreation• Shelter

Happy Planet Index

*

• History of economic growth and GDP

• Critical view of GDP

• Alternative measures to supplement GDP

• Recent initiatives

• Barriers to change

• Path forward

Outline

Integrated Environmental andEconomic Satellite Account

+

= XXX

OECD World Forum

EU Conference: Beyond GDP

Bhutan’s GNH

Stiglitz Commission

• History of economic growth and GDP

• Critical view of GDP

• Alternative measures to supplement GDP

• Recent initiatives

• Barriers to change

• Path forward

Outline

Inertia

Paradigm of Growth

Powerful Interests

• History of economic growth and GDP

• Critical view of GDP

• Alternative measures to supplement GDP

• Recent initiatives

• Barriers to change

• Path forward

Outline

Overcoming Inertia

Changing the Paradigm

Aligning the Efforts

Maybe changingGDP isn’t that

hard.

Let’s Get on with It!

Take a Position!www.steadystate.org

The Centerfor the

Advancementof the

Steady State Economy