Buddhist Economics by Clair Brown

Author:Clair Brown
Language: eng
Format: epub
ISBN: 9781632863676
Publisher: Bloomsbury Publishing
Published: 2016-11-21T16:00:00+00:00

BEYOND GDP

As long as society is focused on what we buy and consume, our thinking and actions and government policy will be formed and then reinforced by the materialistic and individualistic measurement of GDP growth.

How can we measure economic performance so that it reflects our values, and lets us know whether our well-being is improving? We saw in Chapter 2 that over time, national happiness does not increase with national income (the Easterlin Paradox). What about more precise measures of social and economic well-being in developed countries? Here we see a difference in how average and relative income performs: national measures of health, education, and social problems (called quality of life indicators) do not improve with average national income, and so growth in national income (GDP) does not translate into increased national well-being. However, the national quality of life indicators do improve across countries as income inequality decreases. And if we look within a country, the distribution of income does matter: the quality of life indicators improve with people’s income. This reinforces the Buddhist economics approach that cares whether low-income families have adequate income to buy basics, along with access to adequate health care, education, and social networks, so that all people collectively achieve their full potential.

Economic performance must also incorporate progress toward sustainability. Our planet cannot survive economic growth based on our fossil fuel economy. We’ve already seen the global problems caused by extreme weather and rising sea levels, and we must also factor in environmental degradation at the local level, where people’s health is directly harmed by contaminated water, toxic soil, and polluted air in both rich and poor countries.

These results together tell us that the solution is to tie economic growth to improvements in equity, sustainability, and our nonmarket activities as well as to national income. Then we can measure economic performance in a holistic way across countries, and advanced countries will no longer be focused solely on average income growth. A holistic measure shows economic performance increasing when inequality goes down and the consumption of poorer families goes up, and when CO2 emissions go down and the use of renewable energy sources goes up.

Once we begin to measure quality of life as integral to economic performance, we will set goals and develop policies that improve individual and national well-being rather than focus only on adding to income (especially consumption). Establishing a connection between economic performance and well-being encourages people to measure the progress of their lives and the progress of their economy in a more holistic and meaningful manner.

Yes, measuring economic performance in terms of quality of life is a tall order. But fortunately, Buddhist economics does not necessitate relearning everything we know about measuring economic performance. Economists already have ways to measure pollution and environmental damage, income inequality, happiness, human capabilities, and nonpaid activities (both useful and harmful). Around the world, broad measures of well-being have already been developed. Among them are Bhutan’s Gross National Happiness Index, the UN’s Human Development Index, the OECD (Organisation

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