Indicators

On my way to class yesterday I heard just the beginning of an NPR discussion on adding happiness as a new economic indicator. The speaker noted that while the "quality of life," as it is defined economically, has increased twofold in the last fifty years, people are no more happy with all their stuff than they were without it. Given my prior research and continuing interest in the development and use of indicators (both traditional and alternative), naturally I was intrigued.

Indicators in general have had mixed success. Their "facts at a glance" nature that makes them so popular is also their downfall, especially when they are used independent of their context. Many politicians thing more about changing the number than understanding the implications of the number and changing the conditions. Also, once indicators are established, they generally remain in place, unquestioned, even when they no longer measure something useful. The notorious "Gross National Product" (now "Gross Domestic Product"), a throwaway indicator developed in the Great Depression, has remained the salient international economic indicator even though it does not actually reflect the quality of life, individual wealth, and a number of other things people think it means.