An alternative approach to measuring national well-being.
GROSS DOMESTIC PRODUCT, better known by its initials, GDP, has been economists’ chosen measure of a nation’s well-being for over 70 years. But it has limitations; it takes no account of environmental degradation and excludes unpaid services such as volunteering and housework, for example. In the words of Bobby Kennedy, speaking in 1968, “it measures everything…except that which makes life worthwhile.” In an attempt to address these shortcomings the OECD, a mainly rich-country think-tank, has created the “Better-Life” index. Now in its second year, the index uses 24 variables (which include both hard data and survey data) across 11 sectors to create a measure of welfare for 34 of its member countries, plus Brazil and Russia. The Economist has grouped these 11 sectors into four broader categories. (via Daily chart: The wealth of nations | The Economist)