Monday, November 15, 2010
When Growth Isn't Enough
Economics, and NIBC in particular, focuses on quantitative analysis of output, prices, etc. Ultimately, however, none of this really means or measures anything. The true variable to be measured is quality of life. We attempt to do that by GDP per capita, or perhaps even expand it to look at HDI. These are all fundamentally limited however by the belief that quality of life can be measured by material possessions alone. This author argues for a "green economics." This effectively includes other aspects of life, in this case long term environmental concerns, in the goals of economics. If the purpose of economics is to measure human behavior and lifestyles, then factors like this need to be brought in. If that is the case, then the author is correct that growth in and of itself is not sufficient or significant.
Subscribe to:
Post Comments (Atom)
In some ways I agree with the article but what happens when an economy enters a recession or, even worse, a depression? Will GDP and economic indicators short-side our true "quality of life"? I believe such indicators hold even more weight when determining individual quality of life in times of economic suppression.
ReplyDeleteTrue, but this article takes a much more long term view of the situation. It argues that while recession can longer standard of living for a few years perhaps, ignoring these issues will permanently lower the standard of living over time. It effectively argues that there could be an unending recession if we do not look for a more sustainable form of growth.
ReplyDelete