Countries Need to Look Beyond GDP

When governments ask people what truly matters to them, they cite things like being healthy, having a secure and affordable home, enough income to live with dignity, and time for the people they love. As the former leaders of Iceland and Scotland, we have heard concerns first-hand. But these people-first priorities are not abstract ambitions. They are the conditions for a decent life, and ensuring they are met should be the first priority of any government.And yet none of this is captured in the number that most economists, the media, and indeed, governments use to measure a country’s success: Gross Domestic Product (GDP), commonly referred to as economic “growth.” To be sure, GDP has its uses as a measure of many of the goods and services a country exchanges and produces. But today, it is typically used in a way its architects never intended. For instance, a country's GDP rises when a forest is felled and when an oil spill is cleaned up. It rises with financial speculation. But it does not rise when a parent cares for a child or a child for an elderly parent, when the forest is left standing, when a woman can walk home at night without fear, when voters turn out because they trust...