ABSTRACT

It is normal, in governing circles, to initially measure economic success in terms of hard numerical things such as GDP growth, employment levels and living standards; and quite properly so, because those things are important. But simple GDP numbers can also distort, giving weight to things that we may not value/ approve of (such as excessive advertising or bank speculation) while failing to capture things that we do value (such as security, community and the beauty of the natural environment). Indeed, the recent widespread recognition of such limits has stimulated a proliferation of new ways of measuring economic progress and success, ways that do not so much break with this formal reliance on GDP measures as seek to supplement them. Perhaps the best known and most widely used of these new indicators is the United Nations’ Human Development Index (HDI): an index that

adds to simple measures of GDP indices of life expectancy, length of education and per capita income. The UN also issues an Inequality-Adjusted HDI that is more sensitive than the original to dimensions of gender inequality and poverty. But the UN is only one player here. There are many others. In 2008, for example, the French government commissioned a report from three leading economists that combined measures of current well-being with assessments of long-term sustainability. (Stiglitz, 2008) In 2009 the London-based New Economics Foundation produced a set of National Accounts of Well-being that explicitly attempted to capture “how people feel and experience their lives, help to define our notions of national progress, success and what we value as a society.” (NEF, 2009: 3; also Frey & Stutzer, 2002: 36-43) In 2014, leading academics at Harvard followed that with their own Social Progress Index that ranked New Zealand first, ranked the United Kingdom thirteenth and had the United States just outside the top fifteen. (Porter, 2014) Indeed there is now a new and growing academic literature-Richard Layard called it “a new science” (Layard, 2005)—on the economics of happiness. (Frey, 2010: 13-14) We will have cause to draw on that litera - ture later in this chapter, but for the moment all we need note is that the proliferation of such measures underscores just how complex and difficult a matter it is to judge the success or failures of capitalism in general, or of different national capitalisms in particular: but judge them we must.