Letter writer Adam Riggen makes excellent points in his review of why gross domestic product is not a good measure of economic well-being. He and others among your readers might be interested to know that arguments like his led the Vermont Legislature to conceive and pass Act 113 last year. Signed into law by Gov. Shumlin, the act established a ďgenuine progress indicator,Ē or GPI, for the state of Vermont. The GPI corrects the faults and flaws of GDP as a measure of economic well-being by subtracting the costs that economic development brings (everything from environmental damage to leisure time lost to commuting ó expenses that GDP mistakenly counts as beneficial when we pay money to fix them) and adding in the value of benefits (like domestic production ó child care and cooking, for instance) that GDP ignores.
The law commissioned the Gund Institute for Ecological Economics at the University of Vermont to compile a GPI figure biennially. It also announced the Legislatureís intent that the new indicator should play a role in budgeting, program evaluation and economic development decisions. The Gund reported its first compilation of a Vermont GPI to the Legislature in July and expects to unveil its Vermont GPI website before the end of the year. The report can be found on the Gund Instituteís website, along with additional articles, essays and video presentations that explain the indicator in greater detail.
The writer is a fellow of the Gund Institute for Ecological Economics, where he is coordinator of the Vermont GPI project.
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