Why GDP Isn’t A Good Measure Of A Country’s Success

Malcolm Gladwell recently challenged my perspective on GDP, Gross Domestic Product, and whether that was a good measure for a country’s success.

GDP tells a small story: the monetary value of all finished goods and services made within a country during a specific period.

And although that can be a good indicator of the value being created, our economy, etc. there is so much that is not captured in that number. This point is eloquently captured in the below quote.

“Our Gross National Product, now, is over 800 billion dollars a year…Yet the Gross National Product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debates or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country. It measures everything in short, except that which makes life worthwhile. And it can tell us everything about America except why we are proud that we are Americans.”

Bobby Kennedy Former United States Attorney General

Economics 101 teaches us that incentives drive action.

With GDP as our metric of success you can see how America’s priorities align.

In contrast, being someone who believes that families are one of the strongest indicator of a healthy country, what if we measured ourselves by the number of stable families?

How would that change what actions are prioritized?

Photo by Rezaul Karim on Unsplash.

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