决战1010精英组Economist阅读汇——by nanfeng25899

nanfeng25899UID: 2629871

The opposition's opening remarks

Apr 20th 2010 | Steve Landefeld   

Gross domestic product (GDP) is a key measure of a country's economic activity—the purpose for which it was designed. It was not designed to be, nor should be regarded as, a comprehensive measure of society's well-being. Nonetheless, it has also proven useful as a gauge of an economy's capacity to improve living standards. It was a catastrophic decline in living standards that prompted the development of national, or GDP, accounts. Trying to design policies in the 1930s to combat the Great Depression, President Roosevelt had only such sketchy（GRE：a粗略的） data as stock prices, freight car loadings and incomplete indices of industrial production on which to rely. In response, the US Department of Commerce developed a set of national economic accounts that for the first time provided a comprehensive framework to guide policy decisions to assist the millions of people who were out of work.

GDP, and the broader set of national income, product and wealth accounts, has stood the test time and no other measure has proven a worthy alternative. Simon Kuznets, one of the early architects of the accounts, in 1941 recognised the limitations of focusing on market activities and excluding household production and a broad range of other non-market activities and assets that have productive value or yield satisfaction. Yet 75 years and lots of research later, there is no broader social measurement tool that officials would agree is valid and useful.

It would, therefore, seem irresponsible to abandon the most comprehensive and reliable system currently available to tell us how a society is faring economically. GDP may not be a complete measure of improving living standards, but that does not make it a poor one, especially when considering what could possibly replace it today.

There is, of course, room to improve GDP through better measuring of the distribution of the gains from economic growth and the sustainability of that growth, and selected measures of non-market activities that affect the economy—and these concepts have merit. Rather than replacing GDP, the goal might be extending and supplementing GDP and the national accounts, rather than their replacement.

Over time the national accounts have been constantly updated and extended to address changes in the economy and to keep them relevant, and many of the measurement issues raised in the current debate can be addressed within the context of these accounts. Yet extensions of the national accounts cannot be allowed to subject a critical tool for economic policy to uncertainty. Past efforts to expand conventional GDP have foundered on the inevitable problems of subjectivity and uncertainty inherent in measuring happiness, household work and other non-market activities. Critics rightly fear that the inclusion of such uncertain and subjective values in GDP will seriously diminish the essential role of the national accounts to financial markets, central banks, tax authorities and governments worldwide in measuring and managing the market economy.

Much work has focused on how to successfully broaden the utility of GDP, while preserving its core integrity. Several National Academy of Sciences studies on accounting for the environment (Nordhaus and Kokkelenberg, eds, 1999) and non-market production (Abraham and Mackie, eds, 2005), as well as the System of National Accounts (1993) guidelines for compiling GDP, have concluded that an expansion of the GDP accounts should take place in supplemental, or satellite, accounts that extend their scope without reducing the usefulness of the core GDP accounts.

They also conclude that such an expansion should focus on economic aspects of non-market and near-market activities—such as energy and the economy's use of natural resources, the impact of investments in research and development (R&D), health care, or education—and not attempt to measure the welfare effect of such interactions.

Recognising the concerns of subjectivity and uncertainty, the focus should remain on creating "new" estimates within the framework of the existing accounts. For example, the Stiglitz-Sen-Fitoussi Commission (2009), which explored expanded welfare measures, has suggested a number of ways that "classical GDP issues" can be addressed within existing GDP accounts or through an extension and improvement of measures included in existing accounts.

The US Bureau of Economic Analysis focuses on just such improvements, and President Obama this year proposed extensions within the scope of the existing accounts that would provide new measures of:

• how growth in income is distributed across households, other sectors and regions;
• the sustainability of trends in saving, investment, asset prices and other key variables important to understanding business cycles, economic growth and living standards.  

There are, however, limits to what can reasonably be included in GDP. For many years the problem has not been with GDP, but rather the singular focus on GDP alone as a measure of society's welfare. Many non-market measures of welfare may be better included in such measures as the newly authorised US National Academies Key National Indicators System.

These and other efforts in the coming years will lead to a more inclusive set of measurement tools that will enhance our understanding of countries' standards of living. This progress is inevitable, but it does not render current GDP data inadequate. GDP will continue to play a crucial role in measuring social progress in and among countries.

nanfeng25899UID: 2629871

Comments:
The author begins articles with the explanation of the substantial function---the means of measuring the economic activities rather than the well-being using the illustration of its origin.
Then he, admittedly, realized the shortcomings of GDP, but he also emphasized that rather than replacing this tools which have stood the test time, we should make it more perfect by supplementing a few accounts. However, recognizing the concerns of the uncertainty and subjectivity, the measures should be improved within the frame of its existing account.
The problems of GDP have been existed foe many years, In nearby future, more efforts will lead to a more inclusive set of measurement tolls that will enhance the understanding of countries’ standards of living.

nanfeng25899UID: 2629871

The moderator's rebuttal remarks

Apr 23rd 2010 | Patrick Lane  

Welcome to the second, "rebuttal" stage of the debate. From what both Andrew Oswald and Steve Landefeld say, and from the comments from the floor, it's clear that whether you support or reject the motion depends to a large extent on how you define "living standards". Are they limited to material comfort, or do they cover broader, less tangible concepts, not least happiness? This difference of view emerged in the first few online remarks, and it's been a constant theme. Pythian Legume, for instance, is "relatively certain that a claim that it [ie, GDP] does not measure national happiness is off point". Belfast citizen argues: "It is quite true for Mr Landefeld to say that GDP was not designed to be a well-being measure—though that concedes Prof Oswald's case at the outset—but it is treated by most OECD governments as if it were a proxy for well-being."

Here's another dividing line, not yet obvious on the floor but plain between the protagonists（GRE：n提倡者）: is GDP simply out of date, or can it be improved or supplemented by other measures of living standards, however defined? Mr Oswald says that, given the apparent decline in psychological measures of well-being in rich nations, GDP has not (as Mr Landefeld believes) "stood the test of time". It is too narrow an indicator of things that matter to remain a valuable indicator today.

Mr Landefeld remarks that if measures of happiness have not moved much over time, their merits as measures of living standards are in question. Better, he says, to augment GDP with other measures on an economic "dashboard". He suggests that GDP will remain the most closely watched.

On the floor, other themes have emerged. One is perhaps best illustrated by KCCM, who believes that the debate "exemplifies（v举例证明） the economic and attitudinal gulf between developed and developing economies". GDP may seem out of date in the rich world, he says, where most people have satisfactory food and shelter, but in poorer countries, "quantity reigns supreme because many simply do not yet have enough". High GDP growth numbers are a symbol of rising living standards—or, as KCCM put it, of "ability to provide more of what their growing populations realluy need and, eventually, want".

Another topic is the tension between living standards of whole societies and those of individuals or households. A related subject is the distribution of income. Plainly, GDP can capture only aggregates or (if you divide by population) averages. It won't tell you about the living standards of individuals, the gap between rich and poor, or the concentration of riches at the top. It's not supposed to, some may say—GDP per person is a measure of central tendency, not dispersion—but for many participants that's not the point.

Mehmet Asici suggests that GDP may be a fair measure of living standards in fairly equal societies with strong welfare states, but not in places where the distribution of income is highly skewed（GRE：a 倾斜的）. Several participants have said that the answer is not to measure GDP alone, but to have lots of indicators of material and psychological well-being. That in turn raises another question: can these meaningfully be combined into a single measure, or does it make more sense to look at several (back to the "dashboard"), sometimes paying more attention to one indicator and sometimes to another? Quite a few people mentioned the UN Human Development Index. One speaker, haripolit, said flatly that it was pointless to look any farther. Others thought the answer was more complicated.

Before we hear Mr Oswald's and Mr Landefeld's closing statements, we'll have contributions from guest speakers. The first of these will be Enrico Giovannini, formerly chief statistician of the OECD and now head of the Italian national statistical agency. The rebuttals and the guests' statements will, I'm sure, provoke more debate.

nanfeng25899UID: 2629871

Comments:
  The moderator analyzes several comments which provide us a few broader angles to think about this topic.
  For instance, some argue that this indicator can be used as an effective measure in the developing country in which the quantity reigns supreme; On the contrary, the developed counties have enough food. In addition, there is also another point that GDP is just measure of the central tendency, not dispersion, which is a sign of the poor tools to gauge our development.
  Overall, the debate is on the going. The moderator ends with the conviction that the rebuttal and the guests’ statement will provoke a new round of hot discussion.

nanfeng25899UID: 2629871

The proposer's rebuttal remarks

Apr 23rd 2010 | Andrew Oswald   

GDP is too narrow a measure of the things that truly matter to humans to be viewed as a valuable indicator in developed nations like ours in 2010.

Steve Landefeld presents his view cogently, but he proposes an old-fashioned vision that is driven by conventional ways of thinking rather than modern evidence, and he makes no mention of green issues or sustainability.  

Here is an example:

It was a catastrophic decline in living standards that prompted the development of national, or GDP, accounts. Trying to design policies in the 1930s….

I agree with this assessment about the origins of GDP measurement.  But of course such days are long, long gone. This is not an issue relevant to the case for or against GDP in 2010.

Here is a further example:

GDP, and the broader set of national income, product and wealth accounts, has stood the test [of] time and no other measure has proven a worthy alternative.

This is an assertion for which Mr Landefeld gives no evidence. On some measures of mental health, for example, as I tried to explain in the first stage of the debate, there is research evidence that levels of psychological well-being in rich nations are worsening through time.  If so, it would seem to me, and I presume to other observers, that the "test" has been failed.

Mr Landefeld also argues that:

There is no broader social measurement tool that officials would agree is valid and useful.

This is not true: see the Stiglitz report.

Mr Landefeld suggests that it would seem irresponsible to abandon what he sees as the most comprehensive and reliable system currently available. Readers will have to judge for themselves. In my opinion, this takes us back to the kind of status-quo positions adopted in debates since at least the Middle Ages when it was proposed to give up the view that the Earth was the centre of the universe. Presumably we should choose our intellectual positions on the basis of modern data and not because ideas are familiar to us or previously long-accepted.

Mr Landefeld says that the Stiglitz-Sen-Fitoussi Commission (2009), which explored expanded welfare measures, has suggested a number of ways that "classical GDP issues" can be addressed within existing GDP accounts or through an extension and improvement of measures included in existing accounts. Yet, as a read of the report on the web will make clear, his is not in an obvious way an even-handed（GRE：a.公平的） assessment of the Commission (on which I served).  For example, he does not mention the central recommendations in the Stiglitz Report about the need to measure human well-being rather than GDP.

Mr Landefeld believes that alternatives to GDP have…"foundered（GRE：v计划失败；沉没；倒塌） on the inevitable problems of subjectivity and uncertainty inherent in measuring happiness, household work and other non-market activities". Unfortunately, this is an assertion without data to support it. More important, it is time to think about what economists would call the right maximand.   

Consider this possibility. One of Mr Landefeld's close relatives or friends comes to him and says: "Steve, confidentially（GRE：adv 秘密地，悄悄地）, I am really hating my job and my marriage isn't working and I am feeling deeply depressed." Surely he would not say to his relative: "Not interested. Don't give me your subjectivity. Go home and count dollars."

nanfeng25899UID: 2629871

Comments:
Mr Oswald cites the assertion of the Mr Landefeld and then point the flaws of them such as the lack of the data.
In the end, the author ends up this rebuttal with a funny and irony story to refute the view of Mr Landefeld