Global | Beyond GDP: welfare and social and environmental sustainability

Summary

Although GDP per capita is a good aggregate indicator of market activities (with some limitations due to digital disruption), a broader range of indicators than those traditionally used, such as GDP, is required to measure welfare and the progress of societies.

Key points

• Key points:
• By employing a multidimensional approach, the available statistics can be used to develop good aggregate approaches to social welfare that take into account social and environmental sustainability.
• In addition to consumption (per capita, both private and public), hours worked, inequality and life expectancy, it is appropriate to consider the social cost of carbon when measuring social welfare.
• Overall, it should be noted that, in relation to GDP per capita, the welfare gap narrows in more advanced countries and widening in emerging countries — in countries with lower per capita income, inequality is often greater and hours worked higher, whereas life expectancy is often shorter.
• From 2010 to 2017, Spain reached 57.5% of the US per capita income and 74.2% of its well-being, thanks to its longer life expectancy and lower inequality and hours worked.

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