Perils of Measuring Progress: A View from within
Measurements of progress serve as a crucial link between the economy and the nation’s policy establishment. This is reinforced by the raison d’etre of economics: the efficient allocation of resources. Hence, accurate measurements of progress can serve as a basis for decisions to improve resource allocation. It then follows that efficient and effective allocation of resources can be best achieved if progress is measured accurately. Yet the term progress is not without its caveat; the conceptualisation of progress is fraught with difficulties, misconceptions and contradictions. For instance, how does one reconcile the fact that an indicator, which shows excessive levels of carbon dioxide emissions, can be construed as detracting from progress (harmful to both humans and the environment), yet low levels may also indicate a lack of progress? This paper intends to not only highlight these anomalies, but also propose a framework with which to capture a nation’s progress. In particular, this paper aims to abandon any single standardised system of accounts and seek to measure multiple and different dimensions of progress. Adopting a comprehensive approach, the proposed framework will integrate resources and capabilities, social and institutional arrangements, and environmental systems. From this, the question arises then as to how to incorporate the varying dimensions into a single measure; hence a weighting technique will also be proposed.
Keywords: Economic Progress, Measurement
Doctoral Candidate, Victoria University
Dr. Segu Zuhair
Senior Lecturer, School of Applied Economics, Victoria University