GDP doesn’t care about the planet or you

Sovereign Risk, Thought Leadership, Financial Risk & Reward, Policy, Multi-Asset

Consider this.

You have some free time at the end of your day. You lace up your second-hand trainers as you head out for a walk. You take the opportunity to escape a hectic work day and enjoy some time with your companion, agreeing to leave behind all mobile devices as you want to enjoy the surroundings.

As you set off, you watch the insects busying themselves in the foliage and observe the prominence of brightly coloured flowers. The crops in the fields look healthy and close to being harvested. In the distance you can view the flat plains and wonder what wildlife they conceal. The strengthening oranges and reds from the setting sun make you pause but you also observe the darkening skies in the far distance and you ponder what changes the incoming rain will bring to the landscape tomorrow. You take a deep breath of the fresh air; it makes you feel energized and healthy.

As you loop back home you greet your elderly neighbours who have just finished foraging for fruits from some nearby trees. You carry their heavy basket back to their place as you enquire about their health. You wish them an enjoyable evening meal and return home feeling refreshed and relaxed. You try not to take the unpolluted countryside for granted.

And all of this was unrecorded by the economists because it was free; they are ‘non-market’ transactions and therefore go unmeasured. You contributed nothing to GDP, the core metric for prosperity used by governments and the media globally. Your wellbeing, and that of your friends and family, companionship, nature’s beauty along with its resources and services, and your assistance to others, are all economically worthless.

Time for a re-think?

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