Beyond GDP? Welfare across Countries and Time
- (pp. 2426-57)
(Complimentary)
Abstract
We propose a summary statistic for the economic well-being of people in a country. Our measure incorporates consumption, leisure, mortality, and inequality, first for a narrow set of countries using detailed micro data, and then more broadly using multi-country datasets. While welfare is highly correlated with GDP per capita, deviations are often large. Western Europe looks considerably closer to the United States, emerging Asia has not caught up as much, and many developing countries are further behind. Each component we introduce plays a significant role in accounting for these differences, with mortality being most important.Citation
Jones, Charles I., and Peter J. Klenow. 2016. "Beyond GDP? Welfare across Countries and Time." American Economic Review, 106 (9): 2426-57. DOI: 10.1257/aer.20110236Additional Materials
JEL Classification
- D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- E21 Macroeconomics: Consumption; Saving; Wealth
- E23 Macroeconomics: Production
- E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
- I12 Health Behavior
- O57 Comparative Studies of Countries