The traditional economic measures focus upon numerical values almost entirely based upon worth measured in currency (usually U.S. dollar or the European Euro). But are there any widely accepted alternatives? This, of course, is a topic i treat at some length in Section II of DBW: Meaningful.

Here are more references to alternative measures

The OECD’s Better Life Index

The Organisation for Economic Co-operation and Development (OECD is “an international organisation that works to build better policies for better lives. Our goal is to shape policies that foster prosperity, equality, opportunity and well-being for all. …

From https://www.oecd.org/about/

At their “Better Life Index” website https://www.oecdbetterlifeindex.org/#/11111111111 they say:

There is more to life than the cold numbers of GDP and economic statistics – This Index allows you to compare well-being across countries, based on 11 topics the OECD has identified as essential, in the areas of material living conditions and quality of life.

The dynamic graph allows one to compare quality of life on 11 different variables:

OECD Book: How’s Life 2020: Measuring Well-being

OECD (2020), How’s Life? 2020: Measuring Well-being, OECD Publishing, Paris, https://doi.org/10.1787/9870c393-en.

Doughnut Economics

“Think of it as a compass for human prosperity in the 21st century, with the aim of meeting the needs of all people within the means of the living planet.

“The Doughnut consists of two concentric rings: a social foundation, to ensure that no one is left falling short on life’s essentials, and an ecological ceiling, to ensure that humanity does not collectively overshoot the planetary boundaries that protect Earth’s life-supporting systems. Between these two sets of boundaries lies a doughnut-shaped space that is both ecologically safe and socially just: a space in which humanity can thrive.”

The Doughnut of social and planetary boundaries. From https://doughnuteconomics.org/about-doughnut-economics

I talked a lot about Doughnut Economics in Section II, but i recommend going to the source: The Doughnut Economics Action Lab (DEAL)

Tools & Stories

I also highly recommend their “Tools & Stories” guides for creating city portraits, data exploration, and tools: https://doughnuteconomics.org/tools-and-stories:

“Open access tools that anyone can use to turn Doughnut Economics from a radical idea into transformative action. From exploratory workshops to activities, lesson plans, methodologies, and more.”

Amsterdam: Applying the Doughnut to analyze a city.

https://doughnuteconomics.org/amsterdam-portrait.pdf

Alternatives to the GDP

United Nations Human Development Index (HDI)

From https://hdr.undp.org/data-center/human-development-index#/indicies/HDI

The Human Development Index (HDI) is a summary measure of average achievement in key dimensions of human development: a long and healthy life, being knowledgeable and having a decent standard of living. The HDI is the geometric mean of normalized indices for each of the three dimensions.

The health dimension is assessed by life expectancy at birth, the education dimension is measured by mean of years of schooling for adults aged 25 years and more and expected years of schooling for children of school entering age. The standard of living dimension is measured by gross national income per capita. The HDI uses the logarithm of income, to reflect the diminishing importance of income with increasing GNI. The scores for the three HDI dimension indices are then aggregated into a composite index using geometric mean. Refer to Technical notes for more details.

The HDI can be used to question national policy choices, asking how two countries with the same level of GNI per capita can end up with different human development outcomes. These contrasts can stimulate debate about government policy priorities.

The HDI simplifies and captures only part of what human development entails. It does not reflect on inequalities, poverty, human security, empowerment, etc. The HDRO provides other composite indices as broader proxy on some of the key issues of human development, inequality, gender disparity and poverty.

See the website: https://hdr.undp.org

Human development is about expanding the richness of human life rather than simply the richness of the economy. It focuses on people and their opportunities and choices.

Change Our Measures? Absolutely, But the Measures Are Symptoms — the Goal Is to Change Human Behavior.

The UN’s António Guterres called for new visions of progress in his priorities for 2022 speech to the UN General Assembly. Alamy

From https://theconversation.com/beyond-gdp-changing-how-we-measure-progress-is-key-to-tackling-a-world-in-crisis-three-leading-experts-186488

An excellent article, well worth the time it takes to read (it is well written and given the topic, easy reading). It reviews the history and some of the laternative measures, but also explains why it has been so difficult. The concluding paragraph says:

Clearly, the desire to know if society is moving in the right direction remains a legitimate and important goal – perhaps more so now than ever. But in their search for a reliable guide towards social wellbeing, governments, businesses, statisticians, climate scientists and all other interested parties must abandon once and for all what the Nobel Laureate Stiglitz called a “GDP fetish”, and work with civil society, the media and the public to establish a more effective framework for measuring progress.

Why is change so difficult? (Because it requires changing Human Behavior)

Quoting from article:

“Writing in 2009, the then-French president Nicolas Sarkozy explained he had convened a commission – led by internationally acclaimed economists Amartya Sen, Joseph Stiglitz and Jean-Paul Fitoussi – on the measurement of economic performance and social progress on the basis of a firm belief: that we will not change our behaviour “unless we change the ways we measure our economic performance”.

Let me highlight the key phrase:

we will not change our behaviour unless we change the ways we measure our economic performance

But only a few paragraphs later, this thought-provoking article proclaims:

Once again, the emphasis was on measurement (how far have we got?) rather than behaviour change (what should people do differently?). The implication is that changing what we measure necessarily leads to different behaviours – but the relationship is not that simple. Measures and measurers exist in political and social spheres, not as absolute facts and neutral agents to be accepted by all.

This should not dissuade statisticians from developing new measures, but it should prompt them to engage with all who might be affected – not just those in public policy, commerce or industry. The point after all is to change behaviour, not just to change the measures.

YES! The key in all these issues is human behavior. Using different measures will help, especially if they can be used to change the reward system applied to politicians, professors, and business executives. But these are the means: The end — the goal — is to create a radical change in human behavior, one that stope rewarding profit as the sole measure and instead emphasizes quality of life for all of humanity.