New Measures of Progress



The world needs new economic indicators to drive policies that spur equitable growth in wellbeing while reducing our use of natural resources. The global Beyond GDP movement was formed to vet and demonstrate such indicators, and CSE plays an important role in this by advancing the science and practice of the Genuine Progress Indicator (GPI). Gross Domestic Product (GDP) was never designed as an aggregate measure of economic wellbeing, but it has served that role since the end of World War II. GDP sends the wrong economic signals to decision makers – in particular, it grows rapidly when wealth is concentrated in a very few hands, when natural resources are squandered, and when society becomes less safe, overcrowded, polluted, and prone to disasters.

newmeasures1The GPI was created as an alternative measure that, like GDP, is monetized and thus able to be used in forecasting, policy analysis, benefit-cost analysis and the like. The GPI is designed to incorporate many of the costs and benefits overlooked.

The GPI was created as an alternative measure that, like GDP, is monetized and thus able to be used in forecasting, policy analysis, benefit-cost analysis and the like. The GPI is designed to incorporate many of the costs and benefits overlooked by GDP but which have a significant bearing on the economic wellbeing of nations, states, and cities. In terms of benefits, these include the benefits households receive from the consumption of goods and services as well as the goods and services governments and non-profits supply. It also includes the benefits we receive from quality schools, educated communities, modernized infrastructure, protected natural areas, and social capital – goodwill in our communities, neighbors helping neighbors, and volunteering.

With respect to costs, the GPI incorporates the environmental costs of pollution and climate change as well as the social costs of inequality, homelessness, debt and family breakdown. While the GPI cannot and should not be expected to account for all economic costs and benefits of economic activity, it goes far beyond GDP, has been vetted for over 20 years, and is now one of the leading Beyond GDP indicators being considered for more widespread adoption. CSE’s Genuine Progress program consists of three main lines of work:

  • GPI Accounts for Nations, States, and Cities – Publishing replicable GPI accounts is a complex process involving the compilation or modeling of over 250 individual economic, social and environmental metrics that have bearing on quality of life. CSE is one of the few organizations in the US that performs this service.
  • GPI Policy Analysis – As an aggregate measure of economic well being, the GPI can be used to evaluate the beneficial or adverse impacts of public policies. CSE has used the GPI to evaluate the economic impacts of climate action plans, urban stormwater plans, minimum wage laws, tax cuts, and trade agreements. As CSE continues to build out its Genuine Progress program, we will apply the GPI to other policy initiatives of interest to our agency and non-profit partners.
  • GPI 2.0: An Upgrade to GPI Accounting Methods - In 2014, CSE organized an international online discussion group of practitioners to propose and debate advances to the basic GPI architecture, methods, and data sources under the rubric of “GPI 2.0.” We recently published the results of that process in a leading economics journal and are now working with partners internationally to implement the new methods at the national, state, and local levels.


Closing the Inequality Divide in Maryland

Closing the Inequality Divide in Maryland

Most Americans didn’t see it coming. Back at the end of 2004, our nation’s leading economic indicator, the Gross Domestic Product, was soaring along at a robust rate of over 4 percent per year. The prospects for continued prosperity, the GDP figures suggested, seemed comfortably high. In fact, that apparent ... Read More
San Jose State University's Ecological Footprint Challenge

San Jose State University’s Ecological Footprint Challenge

For San Jose State University, CSE developed a customized on-line footprint calculator for students, faculty and staff as well as a competition for the lowest footprint score and greatest footprint reduction. Participants will take a baseline footprint in the fall of 2009, and then be encouraged to implement a wide ... Read More
A New Bottom Line for Progress

A New Bottom Line for Progress

CSE President John Talberth prepared Chapter 2 in Worldwatch Institute’s State of the World 2008. The Chapter, entitled “A New Bottom Line for Progress,” calls for a new set of economic indicators that measure progress towards economic, environmental, and social sustainability and phasing out of the current set of indicators ... Read More