Worldwide economic wealth has quadrupled since 1970, and experts say it will continue to grow exponentially. But at the same time, poverty and economic inequality are on the rise.
Economies aimed only at growth are not enough.
Most countries use measures such as gross national product (GNP) and gross domestic product (GDP) to assess the health of their economies. But these only take into account economic activity and material wealth, leaving out factors like distribution of resources and quality of life.
In the video below, Kate Raworth, economist and senior visiting research associate at Oxford University’s Environmental Change Institute, explains how economies aimed only at growth are not enough. She says things like safety, justice, sustainability, and happiness should also be taken into consideration when countries gauge their progress.
Even Simon Kuznets, the man who helped develop the GNP system for the United States, had surprisingly similar feelings towards these one-sided measures of growth. “The wealth of a nation can scarcely be inferred from a measure of its national income,” Kuznets warned.
But what can replace growth as the aim of economies? Raworth explains below.