The global financial crisis of 2008 did not just reveal the structural defects in our economy. It also laid bare the inadequacy of how government measured success. Even as bankers at some of the world’s leading financial institutions were clearing their desks, our main headline indicators provided almost no warning signals of the catastrophic events that were unfolding.
What we measure – and how we measure it – matters. ‘Measure for Measure’ sets out proposals for 20 alternative measures of economic progress that most reflect the direction needed to achieve fairness, sustainability and long-term prosperity. Rather than the three most commonly used economic measures – GDP, inflation and unemployment – these new measures reflect two overlapping priorities: the need for a more sustainable, long-term economic model; and a commitment to broader-based, more equitable growth.
At their core is an overall headline measure of British economic success: rising prosperity for typical families, measured by real median incomes.