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Economic Policy-Making Beyond GDP An Introduction

Author

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  • Alessio Terzi
Abstract
Gross Domestic Product (GDP) started to be used during World War II to measure the material production needs of the conflict. Throughout the decades, several issues have been identified with measuring economic success via this single indicator. Most prominently, GDP fails to inform decision makers on how the benefits of growth spread across the population, and to what extent these are concentrated in certain pockets of society. Moreover, it does not take into account the depletion of natural resources and environmental sustainability more broadly. As these have become increasingly pressing concerns for policymakers and the public at large, over the past decade, statistical institutes (including Eurostat) have been developing new complementary indicators, which have been embraced to various degrees by several governments and international organisations. At the current juncture, the challenge is to bring these indicators into more active policy-making in a sensible and manageable way. This paper therefore reviews the pros and cons of some of the ongoing efforts, in Europe and beyond, laying out potential avenues for future scholarship on the topic.

Suggested Citation

  • Alessio Terzi, 2021. "Economic Policy-Making Beyond GDP An Introduction," European Economy - Discussion Papers 142, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    • Handle: RePEc:euf:dispap:142
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    File URL: https://economy-finance.ec.europa.eu/publications/economic-policy-making-beyond-gdp-introduction_en
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    Cited by:

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    2. Alessia Arcidiacono & Gianpiero Torrisi, 2022. "Decentralisation and Resilience: A Multidimensional Approach," Sustainability, MDPI, vol. 14(16), pages 1-25, August.

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    More about this item

    JEL classification:

    • B20 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - General
    • B40 - Schools of Economic Thought and Methodology - - Economic Methodology - - - General
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General

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