GDP measures the value of economic production, not whether life is improving for everyone or whether today’s gains can last. A better way to assess prosperity is to keep GDP for what it measures and pair it with a focused set of indicators for people’s current well-being, how outcomes are distributed, and the assets future generations will depend on.
What GDP tells us—and what it leaves out
Gross domestic product (GDP) is a powerful, widely used indicator of market economic output. It answers a useful question: how much is an economy producing? It does not, on its own, describe general welfare, show who receives the gains, or capture every activity and condition that shape people’s lives. The OECD explains that GDP was not designed to represent every aspect of well-being. OECD, Beyond GDP: Measuring What Counts for Economic and Social Performance.
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That distinction matters when GDP rises. Growth can coexist with falling security for some households, unequal access to opportunity, or worsening environmental assets. Rather than discard GDP or demand that one replacement number do everything, use it alongside measures chosen to answer those additional questions.
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A practical dashboard combines a limited number of indicators across three questions: how people are doing now, how those outcomes are shared, and whether the resources supporting them are being maintained. The OECD Well-being Framework covers current outcomes and inequalities, material conditions, quality of life, relationships, and resources needed to sustain well-being in the future. Its framework also identifies subjective well-being, trust, mental health, and social connectedness as developing measurement areas. OECD, Measuring Well-being and Progress.
- Current conditions: Track material circumstances and quality of life, not output alone.
- Distribution: Examine household income, consumption, and wealth, alongside differences between groups and inequalities within households.
- Lived experience: Include people’s reported well-being as a complement to objective conditions, not a substitute for them.
- Future capacity: Monitor the capital and resources that help sustain well-being over time.
These dimensions are meant to support comparison and informed discussion, not to imply that every outcome can or should be collapsed into one score.
Ask “for whom?” as well as “how much?”
National averages can hide how growth is experienced. Looking at the distribution of household income, consumption, and wealth helps show whether gains reach people in poverty and how resources are shared. Group-level outcomes can reveal differences that an overall average misses; household-level data can uncover inequalities concealed when resources are assumed to be shared equally among household members. Opportunity also matters: prosperity is not only an account of what people have today, but whether they can access the conditions that support a better life.
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Measures of trust, mental health, social connection, and subjective well-being add another perspective: how people experience their circumstances. They should be read alongside objective evidence such as material conditions and distribution, since neither perspective answers the whole question alone. OECD, A Broken Social Elevator? How to Promote Social Mobility.
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Measure future prosperity through wealth, not just annual output
GDP is a flow of production over a period. To consider whether current prosperity can endure, wealth frameworks look at the assets that support future opportunities. The World Bank’s Changing Wealth of Nations 2024 describes comprehensive wealth in terms of produced capital, human capital, natural capital, and net foreign assets. Changes in real comprehensive wealth per person are important to assessing sustainability. The World Bank notes that nearly all countries measure GDP, while few produce wealth measures that comprehensively include natural and human capital. Its 2024 edition uses a chained Törnqvist volume index for real wealth estimates, weighting assets by economic importance rather than simply counting them. The publication’s global and regional trends section covers 1995–2020; that label should not be mistaken for the period covered by every analysis in the report. World Bank, Changing Wealth of Nations.
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UNEP’s Inclusive Wealth Report 2023 also takes a stock-based approach that includes produced, human, and natural capital. It presents a comprehensive assessment of 163 countries for 1990–2019 and highlights the relationship between inequality and natural assets. This and the World Bank’s work share broad concepts, but they are distinct initiatives and their estimates should not be treated as interchangeable. UNEP, Inclusive Wealth Report 2023.
How the main approaches differ
| Approach | Main question | Time horizon and focus | What it adds |
|---|---|---|---|
| GDP | How much market output is produced? | Production during a period | A powerful, established indicator of economic output; not a complete account of well-being or distribution. |
| Well-being dashboard | How are people doing, and how are outcomes shared? | Current outcomes, inequalities, and resources relevant to future well-being | Multiple dimensions, including material conditions, quality of life, relationships, and lived experience. |
| Comprehensive or inclusive wealth | Are the assets supporting future opportunities being maintained? | Capital stocks and their implications for future prospects | Produced, human, and natural capital; the World Bank’s comprehensive-wealth scope also includes net foreign assets. |
These approaches answer different questions. They are complements, not a ranked set of competing replacements for GDP.
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Every dashboard involves choices: which outcomes matter, how much detail to include, and how often the underlying data can be updated. A very broad set can become difficult to understand and use; a narrow one can omit important parts of life. The OECD describes the goal as making a dashboard small enough to be comprehensible but large enough to reflect what matters.
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There are practical obstacles too. Analysts need data that can be connected across topics and linked to macroeconomic averages; producers must coordinate methods; measures must be comparable across countries while remaining relevant locally; and results need to arrive in time to inform decisions. The scale of the UN Sustainable Development Goals illustrates the challenge: the 2015 agenda has 169 policy targets and more than 200 indicators, figures cited by the OECD in 2018 as an example of why prioritisation matters. OECD, Beyond GDP.
A useful way to judge a prosperity measure
When comparing measures or dashboards, ask what each one is meant to answer and whether its data support that use. A sound assessment considers:
- Purpose: Does it measure production, present well-being, distribution, or future sustainability?
- Coverage: Which people, outcomes, and forms of capital are included—and which are left out?
- Distribution: Can it show differences between groups and within households, or only an average?
- Data quality and timeliness: Are the figures comparable, sufficiently current, and detailed enough for the decision at hand?
- Clarity: Can readers understand the measure without losing important context?
The best choice depends on the question and context. GDP remains useful for tracking output; a well-being dashboard helps describe people’s present circumstances; wealth measures help assess whether the foundations of future prosperity are being sustained.
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