Economists have known for more than eighty years that the Gross Domestic Product (GDP) is not a good measure of social progress. Numerous attempts have been made to establish alternative indicators of progress. Recently, there have been several policy initiatives to articulate a different kind of economy in which the pursuit of wellbeing takes precedence over the pursuit of growth in GDP.
For the most part, UK policy still proceeds as though growth in GDP is the most important determinant of political and economic success. In the context of declining growth rates across the advanced economies and the need to tackle urgent challenges such as climate change, biodiversity loss and social inequality, this strategy is at best short-sighted and at worst disastrous both for societal wellbeing and for long-term sustainability.
This policy briefing highlights some alternatives to the conventional approach. It presents a three-fold strategy for moving beyond GDP by: changing the way we measure success; building a consistent policy framework for a ‘wellbeing economy’; and addressing the ‘growth dependency’ of the economy.
These strategies are exemplified through various initiatives from around the world which are described in the briefing. The APPG on Limits to Growth seeks to bring these developments to the attention of Parliament and to encourage similar initiatives for the UK. In particular, this briefing recommends:
- a determined effort to develop new measures of societal wellbeing and sustainable prosperity;
- the full integration of these measures into central and local government decision-making processes;
- the alignment of regulatory, fiscal and monetary policy with the aims of achieving a sustainable and inclusive wellbeing economy;
- the establishment of a formal inquiry into reducing the ‘growth dependency’ of the UK economy;
- the development of a long-term, precautionary ‘post-growth’ strategy for the UK.
The Policy Paper is available for download in pdf (2.6MB).
About the Series
Ten years after the financial crisis, sluggish growth, faltering labour productivity and persistent inequalities are creating huge uncertainties for the future of advanced economies such as the UK. Under these conditions, it is challenging to meet the investment needs associated with improving people’s health and wellbeing or to honour our obligations under the Paris Agreement on climate change. The implications for social and political instability are profound. Is a return to high levels of GDP growth the only way to meet these combined challenges? Is such a return even possible? A series of briefing papers from the All-Party Parliamentary Group on the Limits to Growth aims to explore these questions and to create the space for a vital conversation aimed at building An Economy That Works – for everyone.
