Production and Welfare: Progress in Economic Measurement
Journal of Economic Literature
vol. 56,
no. 3, September 2018
(pp. 867-919)
Abstract
While the GDP was intended by its originators as a measure of production, the absence of a measure of welfare in the national accounts has led to widespread misuse of the GDP to proxy welfare. Measures of welfare are needed to appraise the outcomes of changes in economic policies and evaluate the results. Concepts that describe the income distribution, such as poverty and inequality, fall within the scope of welfare rather than production. This paper reviews recent advances in the measurement of production and welfare within the national accounts, primarily in the United States and the international organizations. Expanding the framework beyond the national accounts has led to important innovations in the measurement of both production and welfare.Citation
Jorgenson, Dale W. 2018. "Production and Welfare: Progress in Economic Measurement." Journal of Economic Literature, 56 (3): 867-919. DOI: 10.1257/jel.20171358Additional Materials
JEL Classification
- D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- E01 Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
- E23 Macroeconomics: Production
- E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
- E31 Price Level; Inflation; Deflation
- I20 Education and Research Institutions: General