A Healthy Improvement on GDP
Many of the failures of GDP as a measure of economic performance are well known. Policymakers in search of an alternative should recognize the far-reaching power of healthy life expectancy as a measure not only of individual wellbeing, but of broader macroeconomic conditions as well.
LONDON – Dissatisfaction about GDP is growing. Many economists, policymakers, and other critics question the ability of this central measure of government and social success to recognize the welfare gains from technology, account for environmental degradation, or capture rising inequality. With developments in artificial intelligence and robotics poised to produce considerable labor-market churn while also boosting GDP – a process likely to be accelerated by the ongoing pandemic – these complaints will soon grow louder.
Numerous alternative indicators have long been on offer, but one especially promising option is healthy life expectancy (HLE), a metric that is easily understood and that has obvious importance to each of us individually. Moreover, HLE is already being measured, and happens to address many of the factors that GDP might omit.
Poor environmental conditions, for example, are not conducive to long, healthy lives. And there is plenty of evidence to suggest that individuals who are happy and fulfilled also tend to live longer and remain healthy for longer. Even more to the point, longer healthier lives connect back to GDP itself. Just as rising GDP helps to provide the resources needed to support health, healthy populations support stronger GDP.