France’s President Wants You to Be Happy
In the occasionally perverse world of the dismal science – economics – time spent sitting in traffic jams counts as a positive economic activity. Why? It boosts GDP because it increases gasoline consumption.
If that seems somehow wrongheaded given the uncounted downsides of traffic jams — lost driver productivity, non-renewable resource waste, wear and tear on cars and damage to the environment — then you might see why some economists want to rethink how we measure economic progress. And that rethinking extends to measuring positive contributions too, such as good health care, extended vacations and other things that make people happy.
Now this idea of including human wellbeing — and even happiness — in economic models may be moving from theory to practice in France, where the government has enlisted the help of Nobel Prize laureates Joseph Stiglitz and Amartya Sen, among others, to draw up a report analyzing how economic performance and social progress are measured.
The results are now in and the first conclusions drawn. “For a long time, there has been a problem with the way we calculate and use economic indicators, especially gross domestic product,” explained France’s president, Nicolas Sarkozy, on September 14 when the report was unveiled. “For years, statistics have shown stronger and stronger economic growth,” yet they were hiding the ugly truth that “this growth, by endangering the future of the planet, destroys more than it creates…. Throughout the world, people believe that they are being lied to, that the figures are false and even worse, that they are being manipulated. Nothing is more destructive for a democracy.” The French president also took a swipe at “the religion of statistics,” and described our reliance on them as “a way to avoid ever talking about inequalities.”
The authors of the report believe that while GDP “is not erroneous,” it nevertheless is being used “in an erroneous way,” especially as a measurement of economic wellbeing.
“The great problem now is how to take giant steps toward [building] an economy of intangibles if our indicators only measure tangible goods – and do so in a deficient way,” says David Murillo, professor of social sciences and researcher at the ESADE Business School’s Institute of Social Innovation.
What would happen if the study’s recommendations were adopted by France — or by other countries? Read more in the latest issue of Universia Knowledge@WWharton.