Some of the things that are good for GDP,
but terrible for us,
are, for example, hurricanes and other natural disasters,
wars, drug trafficking, and cybercrime.
Many of those things require police services
or other dedicated services in order to protect,
and this is what makes GPD go up.
[GDP or Gross Domestic Product
is the yardstick we use to measure an economy.]
It measures all the activity that goes on in the economy in a single year.
You can measure it either by adding up everything people spend,
all of the incomes
or all of the outputs in the economy,
like measuring the height of a mountain
or the depth of a river.
But it's not a natural object at all.
It's an analitical construct.
But, of course, that's the kind of arbitrary definition,
and lots of judgments were involved.
And I think it would be really helpful
if people could get their head around the uncertainty
that's involved in measuring GDP.
[GDP is powerful.
It can swing elections
and seal how much a country can borrow.]
[But economists are questioning how useful it is today.]
The term dates back to the Second World War,
when the need was to understand
what resources the war economy needed, and what consumption sacrifices.
Citizens were going to have to make to enable that to happen.
So a whole set of national statistics now dates from the 1940s.
[GDP counts things like deforestation and divorce lawyers,
but overlooks some vital assets.]
It leaves out some important things.
It leaves out the environmental cost of economic growth,
and it leaves out the value of unpaid work that people do in their homes.
And it also doesn't pay any attention
to the national balance sheet, if you'd like,
to the assets that we use to enjoy today's income and consumption.
So if we really care about sustainability,
a very important thing
is to start measuring all of those assets properly as well.
[So what can we do differently?]
[One alternative approach is to focus on "inclusive growth."]
[That's the world economic forum's framework for growth
that benefits society as a whole and will last into the future.]
[Norway is the world leader in the 2018 index.]
It's about equal opportunities for women,
and it's about having a public finance system
of education and of healthcare
which also makes services accessible.
[Norway uses its historical oil wealth to fund public services
and the transition to clean energy.]
[Over 98% of its energy now comes from renewable sources.]
[Norway also has one of the smallest rich-poor gaps in the world.]
[Cleaners and construction workers are paid a minimum of $21 an hour.]
I believe that your history and your culture
does affect how a society is run.
All countries can work towards more inclusiveness
but understanding how their country is functioning.
I think we have been benefited by a quite poor society
newly becoming richer per being rich
after we have established strong institutions.
One of the things we have is a large NGO sector
with a lot of voluntary work,
which is where most of them wishes to live their lives
in activity without us.
And I think that makes very close bonds between people.
[While economic growth
has lifted hundreds of millions of people out of poverty
in the last 30 years,
GDP has failed to capture
some of the biggest challenges of our times,
from inequality to climate change.]
[So what hope will it have for the economy of the future?]
[Should we say RIP, GDP?]
There's a really great appetite at the moment to go beyond GDP
and get a better understanding of economic progress.
This is partially being driven by all the digital change
that we see happening in the economy.
We need to track what that's doing,
which is both, you know, very good
because of the innovations that we're able to use,
but somewhat worrying
if it means that there's going to be disruption to jobs as well.
So we certainly want to track that.
And I think that's the project for the next few years
for researchers and policymakers
to have that conversation about move on
to go beyond GDP for a better measure of economic progress,
but we all began to go to.