An “indicator of affluence” is being constructed and proposed as an alternative to GDP. How to deal with indicators.

【At last, an “index of affluence” will be constructed in earnest to replace GDP.ーspecial feature「THE WORLD IN 2023」】
https://wired.jp/article/vol47-the-world-in-2023-measuring-our-true-riches/

 

・UN Secretary-General Antonio Guterres called for an end to the use of GDP as an economic indicator, which is rated higher for countries that produce more pollution and waste. Destroying forests raises GDP,” Guterres said. He added, “Given the current state of the world, we cannot measure wealth by GDP. We need to move to a recycling and regenerative economy.”

・Originally conceived in 1934, GDP is defined as “the total value added of goods and services produced in the country during a given period of time.” It was an economic indicator introduced by the government during the war to raise money for the purchase of tanks. As such, it was never intended to be used as an indicator of social welfare.

・In fact, many economists dismiss GDP as an outdated and reckless indicator that ignores social aspects such as inequality and air pollution.

・In 2023, when the unprecedented storms of food and energy crises will be brewing, politicians around the world will begin to adopt economic indicators that will replace GDP with a heavy dose of

・Many economists have proposed composite indicators to replace GDP. Examples include Bhutan’s Gross National Happiness (GNH), the United Nations Environment Programme’s (UNEP) Comprehensive Wealth Index (New National Wealth Index), and the Organization for Economic Cooperation and Development’s (OECD) Better Living Index.

 

 

The above is a quote from the article

 

 



 

Indicators = just one perspective, a way of looking at things. How to deal with indicators.

 

Japan’s GDP has barely increased in the past 30 years, and in recent news, Japan’s GDP is about to be overtaken by Germany this year to fall to 4th place.

Thus, the GDP indicator is often mentioned in the news.

However, GDP was conceived in 1934, before the war.

It may, indeed, be strange to use such an old indicator forever.

 

We often hear about Bhutan’s Gross National Happiness (GNH) indicator. So, instead of GDP, should we look at the world in terms of GNH from now on? No, I do not think so.

 

The reason is that GNH is not an indicator (standard) that can be applied to other countries. Like GDP, GNH seems to have a number of problems, such as the fact that there is a discrepancy between Bhutan’s indicators and the actual situation.

 

What I think when I hear these stories,

 

The forms of human happiness and affluence have diversified and become more complex over time,

Therefore, the forms of happiness and affluence of a country have also diversified and become more complex.

Therefore, there should be a variety of indicators to measure a country.

 

My own theory is,
Truth is multi-faceted, so one cannot grasp the shape of truth unless one looks at it from various angles.

 

For example, suppose we have a triangular pyramid. If you look at it from the side, it looks triangular; if you look at it from directly above, it looks like a circle. By looking at it from various angles, it would finally turn out to be a triangular pyramid. That is how truth is, so you cannot tell if you look at it from only one direction (one indicator).

 

Therefore, I believe that indicators such as GDP and GNH should be considered as one angle of view or perspective.

 

When I look at Japan as a country, I see it from a GDP perspective, and I see it from a GNH perspective.

 

Indicators are one perspective, which also includes values. What indicators are important to you also determines what you value.

 

That is also important.

 

I think we have to face the indicators based on this premise.

 

See you then.

 

IQ used to be used for intelligence quotient, but now we have EQ and AQ and so on. If someone says to me now that your IQ is ****, I just think, “So that’s what it is in terms of IQ,” or “You value IQ.” I think that’s the way to face the indicators.

 

 

 

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