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We Need to Start Measuring Progress, Not Just Growth

J. Mijin Cha
Huffington Post


Ahead of Rio+20, advocates are coalescing around the idea that we need to change the way we measure what is important to achieve true sustainable development. Currently countries measure economic growth, which is often equated with progress, through GDP. However, growth in GDP is increasingly not resulting in progress.

For one, GDP doesn't measure many things that are good for society overall but have no monetary value -- like preserving ecosystems and volunteerism -- and it doesn't count things that are bad for society, like the cost of pollution or rising inequality. GDP also cannot reflect quality of economic activity, which means that the economic activity generated by producing toxic chemicals counts the same as increased manufacturing output, even though the latter is clearly better for society overall.

The result is that while GDP continually grows, we are not making progress. A series of infographics from Dēmos shows that as GDP grows, several negative indicators, like poverty rates, incarceration rates, and eco-footprint, have also grown. Because "goods" are not counted in GDP, there is less incentive to invest in and value them. Likewise, not reflecting the "bads" means that their true costs are not transparent. Incorporating metrics beyond GDP would provide a more holistic view of economic growth. In turn, this would begin to shift our economic growth in a way that was more sustainable because the benefit of environmental sustainability would finally be measured.

There is a lot of momentum behind the idea of moving beyond GDP. The World Wildlife Fund will launch the Natural Capital Declaration at Rio to "measure what we treasure," and outline concrete ecosystem accounting policies that governments can follow. Stateside, Maryland and Vermont have adopted a metric called the Genuine Progress Indicator (GPI) as an alternative to GDP. Vermont is the first state to legislatethe use of GPI and use it as a tool to identify public policy priorities. In Maryland, the GPI is a composite of 26 indicators in three categories: economic, environmental, and social. Not surprisingly, because the GPI takes into account things like income inequality and environmental externalities, its growth tracks far below GDP's growth.

As we reach planetary boundaries, endless growth is not the answer. We need progress and we cannot have progress without measuring what we value, even if it isn't monetized.