System of National Accounts

Value of Everything: An Antidote to Chaos The
by Mariana Mazzucato
Published 25 Apr 2018

Kuznets, National Income: A Summary of Findings (New York: National Bureau of Economic Research, 1946), p. 122. 12. United Nations, A System of National Accounts and Supporting Tables , Studies in Methods, series F, no. 2, rev. 1 (New York, 1953). 13. http://unstats.un.org/unsd/nationalaccount/docs/SNA2008.pdf 14. SNA 2008, p. 2. 15. Ibid. 16. P. S. Sunga, ‘An alternative to the current treatment of interest as transfer in the United Nations and Canadian systems of national accounts', Review of Income and Wealth, 30(4) (1984), p. 385: http://doi.org/10.1111/j.1475-4991.1984.tb00487.x 17. B. R. Moulton, The System of National Accounts for the New Economy: What Should Change? (Washington DC: Bureau of Economic Analysis, US Dept. of Commerce, 2003), p. 17: http://www.bea.gov/about/pdf/sna_neweconomy_1003.pdf 18.

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This redefinition of government as a contributor to national product was a decisive development in value theory. Keynes's ideas quickly gained acceptance and were among the main influences behind the publication of the first handbook to calculate GDP, the United Nations' System of National Accounts (SNA): a monumental work that in its fourth edition now runs to 662 pages. THE SYSTEM OF NATIONAL ACCOUNTS COMES INTO BEING After the Second World War, formal international rules were drawn up, standardizing national accounting for production, income and expenditure. The first version of the SNA, compiled by the United Nations, appeared in 1953.12 The SNA describes itself as ‘a statistical framework that provides a comprehensive, consistent and flexible set of macroeconomic accounts for policymaking, analysis and research purposes'.13 It defines national accounting as measuring ‘what takes place in the economy, between which agents, and for what purpose'; at its heart ‘is the production of goods and services'.14 GDP is ‘[i]n simple terms, the amount of value added generated by production'.15 It is defined explicitly as a measure of value creation.

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A., The Public Economy in Crisis: A Call for a New Public Economics (Switzerland: Springer International Publishing, 2016). Simon, H. A., ‘Public administration in today's world of organizations and markets', PS: Political Science and Politics, December 2000. Smith, A., ed. Skinner, A., The Wealth of Nations (1776; London: Penguin, 1999) SNA 1968: A System of National Accounts (New York: United Nations, 1968). SNA 2008: System of National Accounts 2008 (New York: United Nations, 2009). Snowdon, B. and Vane, H., A Macroeconomics Reader (London: Routledge, 1997). Steiner, P., ‘Wealth and power: Quesnay's political economy of the “agricultural kingdom” ', Journal of the History of Economic Thought, 24(1) (2002), pp. 91-110.

Double Entry: How the Merchants of Venice Shaped the Modern World - and How Their Invention Could Make or Break the Planet
by Jane Gleeson-White
Published 14 May 2011

He was made responsible for achieving three things for the United Nations: producing a standard system of national accounts, preparing studies of the national accounts of individual countries, and training other statisticians. The work of Stone and his colleagues first appeared as an appendix—‘Measurement of National Income and the Construction of Social Accounts’—to a report published by the United Nations (UN) in Geneva in 1947. The UN then published it in 1952 as A System of National Accounts and Supporting Tables as part of its ‘Standardised System of National Accounts’. As the first ever attempt to standardise national accounting practice across the world, the UN’s System of National Accounts (SNA) automatically became best international practice.

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It turned out that just as the wealth of Renaissance Italy was underpinned by a new method of bookkeeping, so the art of some of the greatest painters of the age was underpinned by mathematics—and Luca Pacioli was implicated in both revolutionary developments. This book underwent a third transformation when I began to investigate the possibility that the system of national accounting first theorised by one of my economist heroes, John Maynard Keynes, might somehow be related to Pacioli’s Venetian bookkeeping. I discovered that the very same double-entry bookkeeping principles used by the merchants of Venice had been used to construct the national accounts of the United States and Great Britain during the Great Depression and the Second World War.

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At its heart was Keynes’s understanding that ‘modern society would no longer stand “Nature’s cures” of inflation and unemployment for the malfunctioning of the market system’. In other words, modern society required government intervention to moderate rampant market capitalism and minimise the ills of inflation and unemployment. It was for this landmark 1940 pamphlet that Keynes first developed a system of national accounts for the United Kingdom based on double-entry bookkeeping, a system which was published as the appendix ‘A Budget of National Resources’. The budget was based on his General Theory concepts of aggregate demand and aggregate supply, measured in prices and subdivided into components—‘to which he applied the golden rule of double-entry book-keeping, that the sums on both sides of the ledger must balance’.

Capitalism Without Capital: The Rise of the Intangible Economy
by Jonathan Haskel and Stian Westlake
Published 7 Nov 2017

The world’s national statistical offices, the guardians of the GDP statistics that grace news bulletins and analyst reports, gradually began to take notice of the new sorts of investment that businesses were making and to include them in national accounts. In 1993 the System of National Accounts (the international rules for national accounting whose definition of investment we encountered in chapter 2) declared software admissible as investment, followed by the European System of Accounts in 1995 and the UK National Accounts in 1998 (Chesson 2001). The 2008 System of National Accounts recommended R&D as an investment, and this recommendation was introduced gradually by a number of countries (the UK in 2014). Much earlier, but rather unnoticed, the System of National Accounts had in 1993 proposed including investment in entertainment and literary and artistic originals as investment.

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We will stick to the internationally agreed definition of investment used by statistics agencies the world over when they measure the performance of national economies. This has the benefit of being standardized and the fruit of much thought, and of being directly linked to figures like GDP that we are used to seeing in news bulletins. According to the UN’s System of National Accounts, the bible of national accounting, “investment is what happens when a producer either acquires a fixed asset or spends resources (money, effort, raw materials) to improve it.”1 This is a quite dense statement, so let’s unpack what it means. First of all, let’s look at the definition of assets.

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EXAMPLES OF TANGIBLE AND INTANGIBLE BUSINESS INVESTMENTS Tangible investments Intangible investments Buildings Software ICT equipment (e.g., computer hardware, communications equipment) Databases Noncomputer machinery and equipment R&D Vehicles Mineral exploration Creating entertainment, literary or artistic originals Design Training Market research and branding Business process reengineering Source: Adapted from the System of National Accounts (SNA) 2008, para 10.67 and table 10.2, and Corrado, Hulten, and Sichel 2005. The SNA also includes as tangible assets weapons systems and cultivated biological resources. As intangibles it includes R&D, mineral exploration and evaluation, computer software and databases, and creating artistic originals.

GDP: A Brief but Affectionate History
by Diane Coyle
Published 23 Feb 2014

Its purpose should be the revival of a working economy in the world so as to permit the emergence of political and social conditions in which free institutions can exist.16 The administration of President Harry Truman lived up to this vision and provided total aid worth an estimated $148 billion (in 2004 dollars) from 1946 to 1952.17 The devastated countries of Europe depended heavily on Marshall Aid to enable them to survive and rebuild. Throughout that period everything was in short supply and tracking the use of resources was essential. Before long, the United Nations took on the responsibility for setting international standards of measurement in what is now known as the System of National Accounts (SNA). Once available, these statistics on the whole economy found another use. Keynes had wanted to have the figures available for the purpose of wartime planning. But he had also published just before the war his massively influential book The General Theory of Employment, Interest and Money.

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In 1947 the UN issued a technical report recommending how the calculations should be done—the appendix with the relevant detail was written by Richard Stone of the British Treasury. The OEEC followed up with guidelines published in 1951 and 1952, specifically for use in allocating Marshall Aid, and then the UN published the first official System of National Accounts in 1953 (abbreviated as SNA53). The communist countries followed suit but with their own national accounting standard in 1969, the Material Product System (MPS69). As noted in chapter 1, this had the significant difference that only physical goods counted while services were excluded, but in other respects it was an accounting framework similar to that for GDP.

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So for many years the convention was to count financial services as the negative output of an imaginary segment of the economy. It is, to use a phrase from Alice in Wonderland, curiouser and curiouser. As the financial services industry grew throughout the 1980s, the approach changed again, and the 1993 update of the UN System of National Accounts introduced the concept of “financial intermediation services indirectly measured,” or FISIM. This current measure compares banks’ borrowing and lending rates on their loan and deposit portfolios to a risk-free “reference rate” such as the central bank’s policy rate, and multiplies the difference by the stock of outstanding balances in each case.

The Measure of Progress: Counting What Really Matters
by Diane Coyle
Published 15 Apr 2025

See also “­free” digital ­services servitisation/servitised manufacturing, 18–19, 73–74, 75, 75, 81–85, 83; digitisation driving, 85–88 shadow prices, 216–19; asset-­based framework and, 7; comprehensive wealth and, 212; ­measuring economic pro­gress and, 251–53; m ­ easuring economic welfare and, 261 sharing economy, 93–94; ­house­hold capital and, 115–16 shift share, 49 “Six Capitals” approach, 212 skateboards, as user innovation, 141 skill acquisition, ­human capital and, 225 smartphones: diffusion of, 102–4, 103; global production networks and, 155, 157; iPhone, 102, 102–3, 155; transformation of daily life and, 104 social capital, 213–14, 231–32 social i­ nequality, automated decision systems and, 29–31 social infrastructure, 248; defined, 61 social media, welfare consequences of, 134–136 Social Pro­gress Index, 245, 246 social value of data, 146–47, 149, 151 social welfare: ­measuring economic welfare and, 260, 261; well-­being as alternative metric of, 241–42 social well-­being, 250 software: declines in price of, 197–98; open-­source, 143–45 Software as a ­Service (SaaS), 88, 168, 169 solutions, 98; ­services offering, 72–73; servitisation and, 84 Standard Industrial Classification/North American Industry Classification System (SIC/NAICS), 78 Standard Occupational Classification categories, 20 i n de x stated preference methods, 133–37; to estimate shadow prices, 217; in national accounts framework, 137–38 Stone-­Geary utility function, 187 subjective well-­being (SWB) ­measurement, 234–39 subscription-­based production model, 73 subscription economy, 93–97, 127, 128 substitutability: in comprehensive wealth framework, 250; consumer price indices and, 186, 187; between home and market production, 110 superstar phenomenon, 40, 59, 86, 122 supply shocks, global production networks and, 162 sustainability: asset-­based framework and, 7; comprehensive wealth framework and, 247; defined, 207; ethics of growth and, 219–21; ­measuring economic welfare and, 260; production function and, 208–9 Sustainable Development Goals (SDGs), 245, 246 sustainable productivity, ­measuring, 56 System of Environmental-­Economic Accounting (SEEA) Central Framework, 16, 221–22, 252 System of National Accounts (SNA): as accounting framework, 7; core national accounts and ­house­hold satellite, 108, 108; current usefulness of, 13–15; history of, 4, 13 System of National Accounts 08 (SNA08), 16; asset defined in, 215; FISIM and, 17; ­house­hold production and, 106–7; leisure time and, 107–8; on production, 105–6 System of National Accounts 25 (SNA25), 16, 241; inclusion of data assets in, 146; incremental changes of, 6, 259; intangible assets in, 215; intangibles and, 228; missing activities from, 16; satellite digital accounts and, 129 System of National Accounts 93 (SNA93), 17 305 tangible assets, 61 technological presbyopia, 39 technology: consumer price indices and, 183, 186, 188; economic pro­gress and, 1–2, 34; impact on productivity, 37–40; Moore’s Law and, 38, 197; substitution of home production for market production and, 110 telecommunication ­services, price of, 198–201, 199 TeleGeography, 166–67 thick concepts, 261 time: as input and output, 121–24; needed for consumption, 65–66, 105, 123–24, 256–58; productivity growth and, 65–70, 71; spent in production, 123 time ­budget constraint, 124 “time tax,” 4, 67 time-­use accounting framework, 7–8, 143, 256–58 Tornqvist index, 49 total ­factor productivity (TFP): cloud computing and, 90; firm-­level productivity and, 53, 54; growth accounting and, 42–46, 46; growth rate of, 11–13, 12; productivity and, 36, 39 traditional integrated manufacturer, 75, 75 transportation costs, increase in global trade and reduction of, 154 trust-­growth correlation, 232–33 “two Cambridges” debate, 247–48 unbundling: digitally enabled ­services, 163; global production evolution and, 157; in trade practices, 76 unpaid ­house­hold and voluntary activity, missing from SNA25, 16 unsustainability, 207 user-­generated digital products, 129, 142–45 user innovation, 129, 140–42 use value, exchange value vs., 126 utility of goods, innovation and, 69–70 306 value, 178–204; accounting methods for new goods and quality change, 188–90; defined, 6; price index, 181–82; prices as quality signals, 201–2; prob­lems with consumer price indices, 182–88; producer prices, 195–201; significance of deflator prob­lems, 190–95, 203; use vs. exchange, 126 value added: digitisation and shift in capture of, 86; global trade and statistics on, 160–61 Value in Ethics and Economics (Anderson), 220 von Hippel innovation, 140–42 Walmart, 165, 166, 166 Warwick-­Edinburgh ­Mental Wellbeing Scale, 237–38 wealth, 205–39; comprehensive, 210–12 (see also comprehensive wealth framework); defined, 212; enabling capital, 228–33, 229, 230; ­human capital accounting, 224–27; inclusive, 214; natu­ral capital accounting, 221–24, 223; shadow prices, 216–19; sustainability and the ethics of growth, 219–21; well-­being ­measurement, 233–39, 235, 238 i n de x Weapons of Math Destruction (O’Neil), 29 weightlessness, 18, 18–19; bundling solutions and, 72–73 Weightless World, The (Coyle), 18 welfare assessment, subscription economy and, 97 welfare consequences, of Facebook/social media use, 134–36 welfare economics, 31, 263.

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Inevitably, though, the statistical lens through which we all try to understand the economy ­will become blurred at a time when the economy is changing significantly and rapidly—as it is now with the two technological revolutions of AI and digital and of energy transition from carbon-­based to net zero. Th ­ ese two—­information and energy—­are the fundamental “general purpose technologies” that decisively shape the structure of the economy in each era. This is a new era, and a new statistical framework ­will be needed. The current System of National Accounts (SNA), including the all-­ important figure for GDP, dates from the 1940s when physical capital was the binding constraint on growth in the postwar era, natu­ral resources seemed ­free, and the pressing economic policy challenge was seen as effective demand management so the ­Great Depression could never recur.

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This in turn affects decisions made by policymakers, businesses, and individuals and so helps determine what w ­ ill happen in the ­future, in a reflexive ­process. The official economic statistics available are constructed through an extensive machinery of collection and pro­cessing, ­shaped by an intellectual framework dating from the 1940s (as detailed in my book GDP: A Brief but Affectionate History [2014]). This framework, the System of National Accounts (SNA), grew out of early twentieth-­century ­measurement efforts, and its scaffolding is Keynesian macroeconomic theory as interpreted to meet the imperatives of the ­wartime economy. ­There is a fundamental question as to w ­ hether the SNA is still a useful framework. Consider T ­ able 1.1, a version of which is included in Zvi’s 1994 paper, showing the proportion of US GDP accounted for by each sector.

The Growth Delusion: Wealth, Poverty, and the Well-Being of Nations
by David Pilling
Published 30 Jan 2018

But the bulk of its revenue comes from what is called the spread—the difference between the interest rate it charges you and the interest rate at which the bank itself can obtain money. To measure the supposed economic value generated by this interest-rate spread, a new accounting concept was introduced in the 1993 update to the UN System of National Accounts, the holy book of GDP. The concept is called financial intermediation services indirectly measured, or FISIM for short. Without going into technical details, the upshot is that the wider the spread the more value is judged to have been created. That is back to front. In banking, spreads increase when risk rises.

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In Zimbabwe, where only 6 percent of the workforce is formally employed, one cabinet member, the nephew of veteran leader Robert Mugabe, told me over dinner that measuring Zimbabwe’s economy was “like trying to use a tape measure to figure out how much Coke is in this glass.”4 Even in countries not quite so challenged, the method recommended by the UN System of National Accounts to calculate and cross-check GDP—using expenditure, income, and production—is practically impossible. Only a few African countries, one of which incidentally is Kenya, even attempt it. Many use only production. “GDP statistics from African countries are best guesses of aggregate production,” says Morten Jerven, an expert on the subject.

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Throughout our discussion he drinks aromatic tea from a modest silver flask, which his secretary periodically refills with piping-hot water. Calculating economic output, he tells me with lavish understatement, is “interesting and complicated.” China officially began to measure GDP only in 1992, he says. Before then it had used the Soviet system of national accounts known as the Material Product System. That method, which reflected the Soviet Union’s emphasis on heavy industry, barely measured services, which were considered more or less irrelevant. It was only in China’s seventh five-year plan, 1986–90, that the Communist Party, which in all but name had abandoned communism several years earlier, altered its methodology.

GDP: The World’s Most Powerful Formula and Why It Must Now Change
by Ehsan Masood
Published 4 Mar 2021

The arguments for GDP to be replaced, or for it to stop being used, are powerful and compelling, but if that happened it would also mean losing GDP’s strengths alongside its weaknesses—and GDP does have important strengths that need preserving. One of these is that it is set according to internationally agreed rules. GDP’s rules are set through the United Nations System of National Accounts (SNA). The rule-setters have not been oblivious to the critiques, or to developments in China. They can see that evidence is accumulating, and one of the biggest developments since this book’s first edition is that they are preparing to take action. It’s hard to overemphasize the importance of this.

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Having embedded GDP across Europe, Stone would soon turn his attention to organizing accounting systems for the rest of the world. The statistics office of the United Nations got in touch and asked him to prepare a template for national accounting, not only for Europe, but for all UN member states. By the late 1950s the system of national accounts developed under Richard Stone had become the gold standard. When delivering his Nobel lecture in Stockholm in 1984, Richard Stone would pay a generous tribute to his Cambridge University teacher Colin Clark. Clark was Stone’s great mentor, and there is no doubt that the two were close.

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We must begin to give the natural capital stock that produces these services adequate weight in the decision making process, otherwise current and continued future human welfare may drastically suffer. World GNP would be very different in both magnitude and composition if it adequately incorporated the value of ecosystem services. One practical use of the estimates we have developed is to help modify systems of national accounting to better reflect the value of ecosystem services and natural capital.7 The paper proved to be a sensation, dominating global science and environment news coverage for some time after its publication. Partly as a result of the media attention, the paper also generated one of the biggest scholarly controversies of that year.

Cogs and Monsters: What Economics Is, and What It Should Be
by Diane Coyle
Published 11 Oct 2021

However, there is more to the measurement challenge than just having failed to keep up with needing to know how many people are employed in the videogames industry or what proportion of transactions are taking place in bitcoin. Economic statistics fit the world into a philosophical framework. The current System of National Accounts has been described as the ‘one of the greatest inventions of the 20th century’. The invention of GDP (or rather its predecessor GNP) has even been credited with helping the Allies win the Second World War by providing them with a more accurate estimate of the nations’ productive capacity and consumption needs (Lacey 2011).

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The health and economic emergency comes on top of significant changes in the structure of the economy, driven by technology and demography, as well as globalisation and current geo-political reversal. Economists and statisticians, me among them, have been trying to improve the measurement of the digital economy, which is not adequately captured by existing statistics. The current periodic revision of the internationally-agreed definitions, the System of National Accounts, is due to complete in 2025 with revamped approaches to measuring digital activities. The tech-driven changes mean that on the one hand, to take one example, measures of price inflation may miss the many free apps people use—such as taking photos on a smartphone and sharing them online rather than buying a camera and film and paying for developing and printing.

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P., 49 Snower, Dennis, 159 socialist calculation debate, 182–88, 190, 209 social media, 52, 73, 82, 140–41, 149, 157, 163, 173, 176–77, 195 social security, 146 social welfare function (SWF), 122–23 software, 25, 140, 155, 171, 177–78, 186, 197, 200–201, 203 Solow, Robert, 169 Soulful Science, The: What Economists Really Do and Why It Matters (Coyle), 15, 17–18 special interest groups, 64–66 spectrum auctions, 60–61 spillovers, 127, 139–40, 180, 199, 201, 206–8 Spufford, Francis, 182–83, 190 Sputnik, 190 stagnation, 143, 194 Standard Oil, 42 Stanovich, Keith, 47 Stapleford, Thomas, 146 statistics: Annual Abstract of Statistics for the United Kingdom and, 150; causality and, 61, 95, 99, 102; computers and, 17, 52, 58, 144, 169; digital economy and, 113, 150, 164, 170, 172, 212; empirical work and, 17, 52, 61, 90, 95, 99; Goodhart’s Law and, 72; improved methods for, 99–103; inflation and, 113, 146, 148, 164; macroeconomics and, 101–2, 113, 131; microeconomics and, 58, 101; Office for National Statistics and, 171; probability and, 99, 200; progress and, 138, 142, 144–53, 158–59, 164; public responsibilities and, 17, 42, 51–52, 58, 61, 72, 90, 94–102, 113; randomised control trials (RCTs) and, 93–95, 105, 109–10; Sen-Stiglitz-Fitoussi Commission on the Measurement of Economic Performance and, 151; technology and, 169–72, 212; twenty-first-century policy and, 13, 184, 199 steel, 175, 186, 190, 200 Stern Review, 148 Stiglitz, Joseph, 130, 151, 209 stimulus plans, 73, 75 straw men arguments, 1–2, 5, 10, 15 strikes, 31, 68, 192 superstar features, 173–74 supply and demand, 44, 70–71, 174–75, 183 sustainability, 11, 20, 29, 41, 59, 79, 111, 148, 152, 165–67, 214 Sutton, John, 62 System of National Accounts, 151, 164 Tanner Lectures on Human Values, 18, 83 Tarbell, Ida, 42 taxes, 12, 65; behavioural effects of, 3; benefits and, 157; empirical work and, 3; funded health care and, 44; interventions and, 213; national boundaries and, 196; politics and, 132; sales, 105; Trump and, 213; twenty-first-century policy and, 196, 203; value added (VAT), 105 taxis, 59, 68–69, 139, 186, 203 technology: adoption rates of, 172–73; AI and, 28 (see also artificial intelligence [AI]); automation and, 139, 154, 165–66, 195; changing economies and, 13, 168–81; cloud computing and, 150, 170–72, 184, 197; communications, 25–26, 53, 60, 127, 139, 150, 168, 171, 177, 196, 198; computers and, 2 (see also computers); consumers and, 28, 102, 171–76, 181, 200, 213; declining price of, 170; digital economy and, 6 (see also digital economy); electricity and, 65 (see also electricity); Great Financial Crisis (GFC) and, 56, 181; growth and, 71, 132, 140, 202; innovation and, 169–70 (see also innovation); internet and, 46, 97, 133, 138–39, 168, 198; machine learning and, 12–13, 137, 141, 160–61, 187; materials, 127; Moore’s Law and, 170, 184; outsider context and, 103; production and, 12, 132, 140, 169, 176, 195–96, 202, 213; productivity and, 127, 142, 153, 169, 172–73, 192, 194, 202; progress and, 134, 137–42, 160, 164–65; public responsibilities and, 26–28, 35, 40, 71; regulation and, 27, 71, 134, 181; response time and, 26; servers and, 25–26, 141, 170; skill-biased technical change and, 132; smartphones and, 46, 138–39, 164, 171, 173, 177, 195, 198; social media and, 52, 73, 82, 140–41, 149, 157, 163, 173, 176–77, 195; software, 25, 140, 155, 171, 177–78, 186, 197, 200–201, 203; statistics and, 169–72, 212; stock market bubble of, 133; telephony and, 4, 31, 46, 98, 123, 138–39, 144, 156, 164, 171, 173–74, 177, 184, 195, 198; twenty-first-century policy and, 189–90, 195, 202, 205, 208; ultra-high frequency trading (HFT) and, 25–27; welfare and, 177, 181 telephony: communications and, 4, 31, 46, 98, 123, 138–39, 144, 156, 164, 171, 173–74, 177, 184, 195, 198; GSM standard and, 156; smartphones and, 46, 138–39, 164, 171, 173, 177, 195, 198 Tencent, 173 Thatcher, Margaret, 15, 30–31, 36, 124, 158, 192–94, 206–7 3G platforms, 60, 139, 173, 195 time allocation theory, 2 Tirole, Jean, 209 Tories, 148 “Toward a More Accurate Measure of the Cost of Living” (Boskin Commission), 146–47 transaction costs, 36, 38, 129, 168 Trump, Donald, 57, 131, 213 Tucker, Paul, 62 Tullock, Gordon, 33 Turner, Adair, 31–32 twenty-first-century policy: algorithms and, 184–85, 188, 195, 200; artificial intelligence (AI) and, 184, 186–87, 195; behavioural economics and, 186, 202, 207–8; bias and, 187, 209; capitalism and, 186, 190, 195; competition and, 182, 201–9; computers and, 183–84, 186, 188, 214; consumers and, 184, 198–206; digital economy and, 13, 185–88, 194–210; electricity and, 191–92, 200–201; forecasting and, 205; free market and, 182, 186, 191, 193, 195, 207; Great Financial Crisis (GFC) and, 194; Gross Domestic Product (GDP) and, 187; growth and, 187, 191–92, 194, 202, 207, 209; innovation and, 189, 194–95, 200, 204, 209; interventions and, 188, 191, 194, 206–8, 211; Keynes and, 191, 193; macroeconomics and, 191; models and, 185–86, 189, 191, 197, 209; network effects and, 185, 199–202, 205, 209; political economy and, 188–95, 206–7; production and, 183, 185, 194–97, 199, 202; productivity and, 192, 194, 199, 202, 207; rationality and, 194; regulation and, 193–94, 200, 206; returns to scale and, 185–88, 199, 202–3, 209; statistics and, 13, 184, 199; taxes and, 196, 203; technology and, 189–90, 195, 202, 205, 208; twentieth-century economics and, 180; welfare and, 191, 194, 201, 206, 208 Uber, 68, 133, 142, 173, 175, 197, 203 UK Competition Commission, 105 UK Treasury, 74, 126 ultra-high frequency trading (HFT), 25–27 unemployment, 12, 19, 80, 113, 153, 191–92 unions, 64, 68–69, 129, 132, 146, 192, 194 Unipalm, 133 Unto This Last (Ruskin), 20 Uritaxi, 69 “Use of Knowledge in Society, The” (Hayek), 42–43, 183 US Federal Communications Commission, 60 US Federal Reserve Board, 17, 101 utilitarianism, 10, 151 value added tax (VAT), 105 von Mises, L., 182 Wall Street, 19 Waze, 141 Wealth of Nations, The (Smith), 41 webcams, 133 welfare: consumer, 105, 206; digital economy and, 128, 134, 143, 206, 208, 212; Gross Domestic Product (GDP) and, 134; Hicks-Kaldor compensation and, 122; normative economics and, 114, 120, 134; outsider context and, 105–7, 114; Pareto criterion and, 129; positive economics and, 114, 120; progress and, 130, 143; public responsibilities and, 55, 60; separation protocol and, 120–27; social, 55, 106–7, 114, 120–23, 134, 177, 201, 208; technology and, 177, 181; twenty-first-century policy and, 191, 194, 201, 206, 208 What Money Can’t Buy: The Moral Limits of Markets (Sandel), 34 WhatsApp, 171 Whigs, 148 Williamson, Oliver, 63–64 Wilson, Harold, 208 Winter of Discontent, 158, 192 World War I, 2 World War II, 69, 151, 190, 213 World Wide Web, 133, 195 Wren-Lewis, Simon, 31, 75 Wu, Alice, 8 Y2K, 155

Growth: A Reckoning
by Daniel Susskind
Published 16 Apr 2024

Put differently, it is a measure of ‘market production’, ‘products that are either exchanged through market transactions or produced with inputs purchased on the market’.8 When put like that, it might sound like a simple idea. Indeed, in the beginning, its creators appear to have thought as much. The UN System of National Accounts, the international standards for calculating GDP, began life in 1953 as a modest pamphlet of forty pages or so. But over time, people have repeatedly poked sensible holes in the measure. In fact, so much has now been written about these limitations that I wouldn’t be surprised to learn that all this intellectual activity itself makes a modest contribution to GDP.

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(London: Allen Lane, 2020). 45 Feldstein, ‘Underestimating’, p. 145. 46 Thomas Blanchet, Emmanuel Saez and Gabriel Zucman, ‘Real-Time Inequality’, NBER Working Paper No. 30229 (2022); Dennis Fixler, Marina Gindelsky and David Johnson, ‘Measuring Inequality in the National Accounts’, BEA Working Paper Series WP2020–3, December 2020. 47 For pressure, see the discussion of the SNA review here: Paul Allin, Diane Coyle and Tim Jackson, ‘Beyond GDP: Changing How We Measure Progress is Key to Tackling a World in Crisis – Three Leading Experts’, The Conversation, 18 August 2022. For resistance, see page 13 of SNA, System of National Accounts 2008 (New York, 2009). 48 Gilbert, quoted in Moshe Syrquin, ‘A Review Essay on GDP: A Brief but Affectionate History by Diane Coyle’, Journal of Economic Literature, 54:2 (2016), 573–88. 49 John Maynard Keynes and Erwin Rothbarth, ‘The Income and Fiscal Potential of Great Britain’, Economic Journal, 49:196 (1939).

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Kung San people, 11–13 Kallis, Giorgos, 154, 163 Kant, Immanuel, 23 Kantorovich, Leonid, 219–20 Kennan, George, 72 Kennedy, John F., 59, 68, 69, 78, 90 Kennedy, Robert F., 132 Keynes, John Maynard, 3, 14, 19, 60, 87, 142, 253, 260; Economic Possibilities for Our Grandchildren, 79–80, 101; How to Pay for the War, 55–6, 64–5, 297n42 Keynesian economics, 64–5 Keyserling, Leon, 78 Khanin, Grigorii, 69 Khrushchev, Nikita, 68, 220 King, Gregory, 61 King, Mervyn, 142 Klein, Ezra, 320n58 Koyama, Mark, 249 Krugman, Paul, 14, 25, 115, 116, 177, 211–12 Kuznets, Simon, 62–6, 132–3, 141, 293n6, 296n40, 297n41 Large Hadron Collider, 197 Layard, Richard, 86–7, 303n40 Le Guin, Ursula K., xvi Lee, Richard, 11–13, 279n19, 279n22 Lepenies, Philipp, 298n46 Lessig, Larry, 184, 185, 186 Lewis, Arthur, 29 life expectancy, sharp increase after 1800, 8–11 light, price of, 84–5, 129–30 ‘Logic Theorist’ (computer program), 199 ‘long-termism’, 258–62 Lucas, Robert, 24, 25, 35–7, 102, 204, 223–4 MacAskill, William, 194–5, 258–61 Maddison, Angus, 7 Malthus, Thomas, 13–22, 25–6, 40, 281n35 Manabe, Syukuro, 306n10 Manhattan Project, 281n40 Marienthal, Austria, 118 Marjolin, Robert, 59 market fundamentalism, 216–17 Marshall, Alfred, 193 Marshall Plan, 71–2 Marx, Karl: dislike of Malthus, 13, 19, 25; dismisses idea of ‘stationary state’, 165; on forces of production, 50; horror at factory conditions, 270; on inequality, 87; on the merits of growth, 219; as moral scientist, 146; and Rostow, 27; on technological progress, 110; on William Petty, 61 McNeill, John Robert, 220 Meadows, Donna, 149 Merkel, Angela, 75 Messi, Lionel, 114 Microsoft, R&D (Research & Development), 188 Milanovic, Branko, 116, 163 Mill, John Stuart, 25, 146, 167–8, 284n7 Millikan, Max, 71 ‘mini-publics’, 264–8 Mises, Ludwig von, 216 Mishan, Ezra, The Costs of Economic Growth (1967), 154 Moderna (company), 200 Mokyr, Joel, 47, 50–2, 209, 210, 308n39 Moon Jae-in (South Korean president), 266 Moore, Gordon, 195 Moore’s Law, 195–6 Morris, William, 152 Moser, Petra, 191 Mouffe, Chantal, 304n49 Musk, Elon, 258 Nagel, Thomas, 166, 320n54 Napoleonic Wars, 21 national accounting, 60–3, 66 Neumann, John von, 191 Newton, Isaac, 41, 46, 196 Nietzsche, Friedrich, 138, 274 Nixon, Richard, 59, 295n20 Nordhaus, William, 57, 62, 129–30 North American Free Trade Agreement (NAFTA), 256 North Douglass, 45, 46 Obama, Barack, 216, 236–7, 257, 269 Okun, Arthur, Equality and Efficiency (1975), 229–30, 231–2 OpenAI (company), 189, 244 oral hydration therapy, 38 Ord, Toby, 259 Organisation for Economic Co-operation and Development (OECD), 204, 265 Organisation for Economic Development, 59 Orwell, George, 68, 328n3 Pareto, Vilfredo, 91, 232 ‘Pareto efficiency’, 232–4 Parfit, Derek, xvii, 165, 221 Parrique, Timothée, 154 patents, 179, 181 Pearson, Karl, 42 Peccei, Dr Aurelio, 153, 317n15 Pepys, Samuel, 61 Petty, William, 61 Pinker, Steven, 79 Plato, ‘Noble Lie’, 116 pluralism, 145–6 politics, and economic growth, 110–14 Posner, Richard, 180 poverty, decline of, 79–80 price mechanism, 217–18 prostitution, and GDP, 134–5 Proudhon, Pierre-Joseph, 284n9 public-private investment, 189–190, 190 R&D (Research & Development), investment in, 186–90 Radishchev, Alexander, 62 randomized control trial (RCT), 44, 290n54 Rawarth, Kate, 160, 254, 312n28 referenda, popular, 263 remote-work technologies, 213–14 renewable energy, 235–41 Ricardo, David, 14, 21, 25, 114, 283n7 Ridley, Matt, 14 Rini, Regina, 260 Robbins, Lionel, 231–2 Robinson, James, 47 ‘robot tax’, 243 Rockoff, Hugh, 298n46 Rodrik, Dani, 116 Rogoff, Kenneth, 93 Romer, Paul, 35–42, 45, 52, 156, 157–9, 203, 209, 210, 289n46 Roosevelt, Franklin D., 63, 64, 67 Roser, Max, 80 Rosling, Hans, 84 Rostow, Walt, 27–8, 58 Rubin, Jared, 249 Ruskin, John, 152, 270 Russell, Bertrand, 199 Sachs, Jeffrey, 46 Samuelson, Paul, 21, 57, 58, 69–70, 114, 153 Sandel, Michael, 138, 147, 252, 263, 265, 293n4 Schlesinger, Arthur, 296n35 Schmelzer, Matthias, 154, 163, 300n67 Schumpeter, Joseph, 152 Scientific Revolution, 50–1 Scruton, Roger, 273 Second World War, and national economy, 64–7 Sen, Amartya, 145, 146 Senior, Nassau, 19–20 Shannon Diversity Index, 144 Shelley, Percy Bysshe, 13–14 Skidesley, Robert and Edward, 293n4 Smil, Vaclav, 237 Smith, Adam, 25, 146, 178, 282n44, 283n7, 311n13 Smith, Noah, 150 socialism, and economic growth, 220–1 Socrates, 322n15 solar energy, 235–6 Solow, Robert, 31, 35–6, 40, 52, 93, 157, 223, 317n25 Solow-Swan model, 31–4, 157, 287n31 Solyndra (solar company), 216 South Korea: citizen assemblies, 266; economic transformation, 245–7 Soviet Union, and the Cold War, 67–70 Sowell, Thomas, 229 Spufford, Francis, 220 Steinsson, Jón, 164 Stern, Nicholas, 235 Stern Review (on climate change), 235 Stevenson, Betsey, 88 Stiglitz, Joseph, 123, 145 Stone, Richard, 66, 71 Strayer, Joseph, 71 Suetonius, 178 Summers, Larry, 93, 156, 175 surveillance, of employees, 108 Susskind, Daniel, The Future of the Professions, 199 Susskind, Jamie, 112, 268, 305n52 Swan, Trevor, 31, 157 Swartz, Aaron, 184, 185–6 Syrquin, Moshe, 298n46 technological progress: and diminishing returns, 33–4; and innovation, 199–202; and threats to employment, 106–10 Thatcher, Margaret, 263 Thiel, Peter, 75 Thomas, Robert, 45 Thunberg, Greta, 149–50, 155–6 Tobin, James, 59, 89 trademarks, 179, 181 Truman, Harry S., 79 Trump, Donald, 190, 263 Turner, Adair, 293n4 Ulam, Stanislaw, 114 unemployment: and economic growth, 75–9; and technological change, 106–10 Union of Soviet Socialist Republics (USSR) see Soviet Union United Nations (UN): adopts GDP measure, 72; Climate Action Summit (2019), 149; Millenium Goals, 81; pledge for full employment, 77; System of National Accounts, 127, 140 United States of America (USA): and the Cold War, 67–9; and economic growth, 59; economy in the Second World War, 64–5, 67; Employment Bill (1945), 77, 78; Great Depression, 62–3, 75–7; labour market, 256–7; patent and trademark protection, 181–2 universities, administrative bloat, 198 Vauban, Sébastien Le Prestre de, 62 Vitruvius, 178 Volcker disinflation, 162 Vollrath, Dietrich, Fully Grown, 175 Vries, Jan de, 277n2, 277n3, 291n62 Vries, Peer, 292n72 wage inequality, 104 war, and national economies, 60–7 wealth inequality, 105 Weber, Max, 46, 291n62 Weitzman, Martin, 257 welfare economics, 146 Whitehead, Alfred North, 51, 199 Wilde, Oscar, 268 Wiles, Peter, 69, 221 Winner, Langdon, 267 Wittgenstein, Ludwig, 207 Wolfers, Justin, 88 Wordsworth, William, 13 World Bank, 30, 66, 80, 115 World Trade Organization (WTO), 256 Limits of Growth (Club of Rome report, 1972), 153, 222 Yale University, 198 Yudkowsky, Eliezer, 126 Zuckerberg, Mark, 114 THIS IS JUST THE BEGINNING Find us online and join the conversation TWITTER / X twitter.com/penguinukbooks FACEBOOK facebook.com/penguinbooks INSTAGRAM instagram.com/penguinukbooks YOUTUBE youtube.com/penguinbooks PINTEREST pinterest.com/penguinukbooks LINKEDIN linkedin.com/company/penguin-random-house-uk TIKTOK tiktok.com/@penguinukbooks For the latest books, recommendations, author interviews and more Sign up to the Penguin Newsletter Find out more about the author and discover your next read at Penguin.co.uk PENGUIN BOOKS UK | USA | Canada | Ireland | Australia New Zealand | India | South Africa Penguin Books is part of the Penguin Random House group of companies whose addresses can be found at global.penguinrandomhouse.com.

The Autonomous Revolution: Reclaiming the Future We’ve Sold to Machines
by William Davidow and Michael Malone
Published 18 Feb 2020

Suppose you can get rid of your car because work and shopping come to you. Well, in those cases you might be able to live better on less income. In a world in which everything else is being redefined, our definitions of quality of life have to change as well. Simon Kuznets, who developed a system of national accounts, is considered to be the father of GDP. He received the Nobel Prize in Economics for his work, which took place during the 1930s. During that time, Presidents Hoover and Roosevelt were working to combat the Great Depression but had only fragments of indirect data, such as freight car loadings and stock prices, with which to evaluate the effectiveness of their new policies.36 The measurement schemes Kuznets devised helped them develop more finely honed approaches.

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SEARCHING FOR NEW METRICS In the face of the current shift in the nature of productivity, we no longer have an accurate measure of success. Benefits indexed to obsolete forms of economic measurement will need to be re-indexed. And those new measurement systems will have to reach beyond the system of national accounts that Kuznets helped establish if we are to truly determine “the welfare of the nation.” Recently, the Skoll Foundation became a major backer of an effort to create a Social Progress Index that uses fifty factors to evaluate the quality of life in various nations and geographies.38 The index takes into account things like access to health care, water and sanitation, environmental quality, advanced education, and personal safety.

Green Economics: An Introduction to Theory, Policy and Practice
by Molly Scott Cato
Published 16 Dec 2008

The two most important conventional indicators are GDP (gross domestic product) and GNP (gross national product); the distinction between these two depends on whether production by citizens of a country earned overseas is included or not, and since rapid globalization began GDP has become the favoured measure among economists and policy makers. In the prologue to her book If Women Counted, Marilyn Waring, a New Zealand feminist economist, writes of her realization of the importance of national accounts during her experience as a member of the NZ Public Accounts Committee: I learned that in the UNSNA [United Nations System of National Accounts], the things that I valued about life in my country – its pollution-free environment; its mountain streams with safe drinking water; the accessibility of national parks, walkways, beaches, lakes, kauri and beech forests; the absence of nuclear power and nuclear energy – all counted for nothing.

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Velcro Contraction and Convergence: a proposed system of reducing global greenhouse gas emissions on the basis of an equal share for every global citizen a scheme for allocating the right to produce CO2 between citizens of a nation state a system allowing countries or organizations to exchange the right to produce CO2 so that those who can more efficiently reduce emissions reduce more and are paid money in compensation 216 GREEN ECONOMICS carrying capacity CI CLT community currencies CSA CSR Defra ecological footprint ecological rucksack ecological modernization ecotaxes embodied energy ETS Gaia hypothesis GAST GDP Green Industrial Revolution greenwash IMF intermediate technology ISEW Kyoto Protocol LDCs LVT NEF Passivhaus peak oil the size of population of species that an ecosystem can support within its natural resource limits and without degrading natural capital for future generations Citizens’ Income: a payment made to every citizen of a state as a right and without reciprocal demands or duties Community Land Trust: a system of mutual land ownership by the community alternative forms of money issued by local communities to help strengthen their local economies community-supported agriculture corporate social responsibility Department for Environment, Food and Rural Affairs (UK) a way of measuring human demand on the planet in terms of productive land the total weight of material flow carried by an item of consumption in the course of its life cycle academic and policy discourse which suggests that sustainability is possible without systemic social and environmental changes taxes designed to achieve environmental benefits the amount of fossil-fuel energy required to make a product that is directly related to the climate change impact of that product Emissions Trading System: EU system of carbon trading the perception of planet Earth as a single, self-regulating living organism General Agreement on Sustainable Trade: a proposed sustainable alternative to the present world trading system Gross Domestic Product: a key measure of a country’s economic activity within the conventional economic paradigm the idea that moving to a sustainable economy will require an upsurge of ingenuity and activity analogous that which occurred at the dawn of industrialism attempt by a company, generally a large corporation with a significant PR budget, to paint its activities as greener than they are International Monetary Fund a means of transferring sophisticated technologies to poorer countries using resources available there Index of Sustainable Economic Welfare: a proposed alternative to GDP as a measure of economic activity an international agreement adopted in 1997 with the aim of reducing the signatories’ greenhouse gas emissions less-developed countries Land Value Taxation New Economics Foundation home designed so that it can be naturally warmed and ventilated without the need for energy inputs the idea that oil production will reach a peak and then decline, with a severe impact on global economic activity FURTHER RESOURCES permaculture 217 a system for designing human settlements so that they mimic the interrelated structure of natural systems reskilling the idea that to make possible the sustainable self-reliant communities of the future we will need to learn more practical skills Right Livelihood Award the alternative green version of the Nobel Prize, awarded annually by the Swedish Parliament self-provisioning providing for more individual or community needs oneself and without resorting to the market social economy the part of the economy that is outside the market and the state and responds to human needs rather than the profit motive – a new way of describing ‘mutual aid’ solidarity economy an approach to the global economy that foregrounds social justice in economic relationships TEQs a system for rationing the right to produce CO2 on an individual basis TNCs transnational corporations triple-bottom-line a way of measuring a company or organization that includes accounting consideration of social and environmental consequences rather than focusing exclusively on the economic UNCTAD United Nations Conference on Trade and Development UNFPA United Nations Population Fund UNSNA United Nations System of National Accounts: the international standard for measuring economic activity within the conventional economic paradigm WTO World Trade Organization zero-carbon house a home that is neutral in terms of its CO2 emissions because its fossil-fuel use is offset by the energy it generates via renewable technologies Index absolute poverty 173 advertising 174 agriculture 197–202 alienation 59, 183–184 alternative currencies see local currencies alternative food economy 95 anarchism 179 Anderson, V. 117 Aquinas, St Thomas 65 Argentina 65, 84–85 Aristotle 18 Association of Heterodox Economists 31 Australia 192 balanced economy see steady-state economy Barnier, M. 143 Barry, J. 174, 179 BAU (business-as-usual) 90, 91, 107 Bhumibol Adulyadej 149 Bhutan 119 biofuels 48 bioregionalism 5, 20, 150–153 borrowing 182–183 Boulding, K.

Wall Street: How It Works And for Whom
by Doug Henwood
Published 30 Aug 1998

The FoF are not as well known as the national income and product accounts (NIPA), which measure gross PLAYERS domestic product and its components, but they're a rich source of information on how the various pieces of the financial system connect with each other and with the real world. In the inelegant words of their keepers, "[t]he flow of funds system of national accounts is designed to bring the many financial activities of the U.S. economy into explicit statistical relationship with one another and into direct relation to data on the nonfinancial activities that generate income and production.. .[and] to identify both the influences of the nonfinancial economy on financial markets and the reciprocal influences of development in financial markets on demand for goods and services, sources and amounts of saving and investment, and the structure of income" (Federal Reserve Board 1980, p. 2).

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Bureau of the Census 1995, table 847, p. 543). 2. The NIPAs also have little to say about U.S. relations with the outside world; these are covered in the balance of payments (BoP) accounts, which, like the NIPAs, are compiled by the Commerce Department's Bureau of Economic Analysis. The UN's System of National Accounts covers all these bases — NIPAs, BoP, and FoF — in a unified way, but the U.S. is only slowly moving towards compliance with the SNA standard. 3- Not shown is state and local government debt, which had a short burst in the 1950s, fell back in the early 1980s, and then rose some in the late 1980s; 1995's figure of 14.9% of GDP is little different from 1962's 14.0%. 4.

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See shareholder(s) stocks vs. flows, 58 Strategic Investing, 104 Stronach, Frank, 113 Stuart, John Mill, 199 stub stock, 270 Sumitomo, 299 Summers, Lawrence, 177, 186 in the real world, 179 supply-side economics, 47, 103, 274 Survey of Consumer Finances, 64, 69, 79, 114, 115 Survey of Current Business, 136 Swann, Bob, 314 swaps, 34-37 swaptions, 36 Sweden, 235 taxes on brokerage services, 318 wage-earner funds, 306-307 wealth tax, 316 Sweezy, Paul, 258, 261 Switzerland, wealth tax, 316 Syntex, 129 System of National Accounts, 114 taxes break for municipal bond interest, 27 consumption, 70 inheritance, 3l6 investment tax credits, 184 on securities transactions, 317-319 wealth, 315-316 technical vs. fundamental trading. 105 technostructure CGalbraith.), 259 Templeton, Sir John, 311 Thatcher, Margaret. 108. 311 Third Worid debt crisis, 110 political uses of, 294-295 development finance and capital flows, 110 stock markets, 15 inexplicability of returns, 125 TTiomas, Michael, 286 thrift campaigns, Keynes's denunciation of, 196; see also austerity thrifts (S&Ls), 81 crisis, 1980s, 86, 101 and early-1990s credit crunch, 158 Wall Street fleecing of, 180-181, 186 tobacco, 311 Tobias, Andrew, 81 Tobin, James, 143, 318-319; see also q ratio 371 WALL STREET Tompkins, Doug, 245 trade, merchandise, and currency trading, 42 traders vs. investors, 104-105 trading prowess, 32 trading strategies, 104-106 trading week, 127-135 transactions-cost economics, 248-251 financial applications, 249 transactions costs and efficient market theory, l64 estimate of, 249 international comparisons, 317 transactions taxes, 317-319 Treasury bonds.

Financing Basic Income: Addressing the Cost Objection
by Richard Pereira
Published 5 Jul 2017

Total Australian land values increased from $665.1 billion in 1989 to $4267.5 billion in 2014 for a total increase of 541.6%. On an annual basis over 25 years this amounts to a long-term trend of 7.72% increase per year for all land. Fig. 4.2 Total Australian land prices 1989–2014 (Note: Australian Bureau of Statistics (ABS) 5204.0 – Australian System of National Accounts, 2014–2015, Table 61, column AT: http://​www.​abs.​gov.​au/​AUSSTATS/​abs@.​nsf/​DetailsPage/​5204.​02014–15?​OpenDocument) Fitzgerald calculates potential land rent of $206.01 billion on a total land value of $3.684 trillion using the 5.5–6.5% rate. Existing land taxes are estimated at 2.5% giving existing revenue of $91.1 billion.

Capitalism and Its Critics: A History: From the Industrial Revolution to AI
by John Cassidy
Published 12 May 2025

After explaining how value is created, he divided it into three separate components: C, which he called “constant capital,” stood for the cost of raw materials and wear and tear to machinery; V, which Marx referred to as “variable capital,” stood for the cost of labor power; and S represented surplus value.44 Armed with data on these quantities, it is possible to track the total output that an economy produces (C + V + S); as well as the rate of profit (S / (C + V)); the rate of surplus value (S / V), which Marx referred to as the “rate of exploitation”; and the labor share in income (V / (C + S + V)). These days, virtually all governments rely on the Keynesian system of national accounting, and so the Marxian aggregates aren’t used much, but they, too, provide an overall picture of the economy. As the Japanese economist Shigeto Tsuru pointed out in 1942, it is a relatively simple matter, in algebraic terms, to show how they relate to their Keynesian counterparts.45 Marx’s second regularity was his Law of Accumulation, which he expounded in chapter 25 of Capital: Volume I.

…

In her prologue, Waring brought up Wages for Housework, saying she shared Mariarosa Dalla Costa’s “original intention of providing a tool for raising consciousness and for mobilizing women everywhere.”43 She also hailed Ester Boserup, a Danish economist whose 1970 book, Woman’s Role in Economic Development, had emphasized the positive economic contributions that women in developing countries made through their paid and unpaid labor inside and outside the home. Noting that she was writing in the same tradition as these and other feminist pioneers, Waring said her goal was to demystify the UN System of National Accounts, the set of accounting conventions that most countries used to calculate GDP. She wrote: “It is my confirmed belief that this system acts to sustain, in the ideology of patriarchy, the universal enslavement of women and Mother Earth in their productive and reproductive activities.”44 Waring traced the origins of national income accounting back to Sir William Petty, a seventeenth-century English polymath who in 1665 produced some rough estimates of his country’s overall riches, distinguishing between stocks (wealth) and flows (income).

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Twain, Mark UBS Udall, Stewart Uitlanders Ukraine unemployment; benefits; in Britain; and business opposition to full employment policies; in Chile; Friedman on; government work programs and; Great Depression and; inflation’s relationship to; rates of; reserve army of workers and; Robinson on; workhouses and UNESCO Union Carbide Union for the Regeneration of Russia Union Pacific Railroad United Auto Workers United East India Company (VOC) United Fruit Company United Kingdom, see Britain United Labor Party United Nations; African Institute for Development and Planning; domestic work and; New International Economic Order and; System of National Accounts; World Conference on Women United States; agriculture in; cars in; China’s trade with; Civil War in; in Cold War; corporate profits in; defense spending in; economic recession in; economy of; family income in; GDP of; global dominance of; gold standard and; government spending in; imperialism of; income inequality in; Indigenous people in; industrialization in; inflation in; land in; manufacturing and exports of; Marx on; multinational companies of; population of; post–Civil War era in; presidential elections in; profit share in; Reconstruction in; scientific research in; slavery in; South in; unemployment in; wage stagnation in; westward expansion of; World War I and; World War II and; WPA in United States Chamber of Commerce Universal Negro Improvement Association Universal Workers’ Union University of Chicago University of Chile University of Massachusetts at Amherst University of North Carolina Press University of Wisconsin Unto This Last (Ruskin) Uruguay Round US Steel utilitarianism utilities, public utopian socialism; see also cooperative communities Valls, Manuel value: labor theory of; surplus Vanderbilt, Cornelius Vanderbilt, Cornelius, II Vanderbilt, Mrs.

The People's Republic of Walmart: How the World's Biggest Corporations Are Laying the Foundation for Socialism
by Leigh Phillips and Michal Rozworski
Published 5 Mar 2019

Established in February 1921, Gosplan was tasked with crafting a single economic plan for the entire country, to be recommended to its decision-making superiors in the Council of Labor and Defense, an economic-military cabinet itself established to move Russia beyond the ad hoc approach to planning necessitated by civil war. Gosplan was also to develop the budget and investigate options for currency, credit and banking. Under the NEP, the Gosplan bean counters, many of them experts who were not members of the Bolsheviks, crafted what was likely the very first system of national accounts in history—a complete accounting of the economic activity of a country: the aggregate of its production, income and expenditure. A handful of Western nations would begin to adopt such practices in the ’30s and ’40s, doing so more widely only after the Second World War. After 1926, the role of Gosplan strengthened.

Thinking in Systems: A Primer
by Meadows. Donella and Diana Wright
Published 3 Dec 2008

It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile.16 We have a system of national accounting that bears no resemblance to the national economy whatsoever, for it is not the record of our life at home but the fever chart of our consumption.17 The GNP lumps together goods and bads. (If there are more car accidents and medical bills and repair bills, the GNP goes up.) It counts only marketed goods and services.

Why Information Grows: The Evolution of Order, From Atoms to Economies
by Cesar Hidalgo
Published 1 Jun 2015

They also modeled economic growth as the tug-of-war between an economy’s savings rate (the capital that it keeps for later use) and capital depreciation (the wear and tear that erodes capital). Robert Solow advanced the prototypical model of economic growth in the 1950s—a timely development, as the data needed to evaluate such models were just becoming available. Simon Kuznets, the Russian-born economist who fathered GDP, had finished creating the system of national accounts a couple of decades earlier, helping generate the economic metric that dominated the twentieth century.4 Solow’s model, however, did not measure up well when it was compared with empirical data. As Kuznets famously remarked in his Nobel Prize acceptance speech, “The earlier theory that underlies these measures defined the productive factors in a relatively narrow way, and left the rise in productivity as an unexplained gap, as a measure of our ignorance.”5 Kuznets’ “measure of our ignorance” is what we know technically as total factor productivity (TFP).

Ten Lessons for a Post-Pandemic World
by Fareed Zakaria
Published 5 Oct 2020

2020: Measuring Wellbeing,” OECD Better Life Index, https://www.oecd-ilibrary.org/docserver/9870c393-en.pdf: Mean household adjusted disposable income is obtained by summing all the (gross) income flows (earnings, self-employment and capital income, current transfers received from other sectors) paid to the (System of National Accounts) household sector and then subtracting current transfers (such as taxes on income and wealth) paid by households to other sectors of the economy. The term “adjusted,” in National Accounts vocabulary, denotes the inclusion of the social transfers in-kind (such as education and health care services) that households receive from government.

The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies
by Erik Brynjolfsson and Andrew McAfee
Published 20 Jan 2014

It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion. It measures everything, in short, except that which makes life worthwhile.” —Robert F. Kennedy WHEN PRESIDENT HOOVER WAS trying to understand what was happening during the Great Depression and design a program to fight it, a comprehensive system of national accounts did not exist. He had to rely on scattered data like freight car loadings, commodity prices, and stock price indexes that gave only an incomplete and often unreliable view of economic activity. The first set of national accounts was presented to Congress in 1937 based on the pioneering work of Nobel Prize winner Simon Kuznets, who worked with researchers at the National Bureau of Economic Research and a team at the U.S.

The God Species: Saving the Planet in the Age of Humans
by Mark Lynas
Published 3 Oct 2011

The starting point for this process has to be valuing natural capital. As Pavan Sukhdev, lead author of the 2010 The Economics of Ecosystems & Biodiversity (TEEB) report, is fond of saying: “You cannot manage what you do not measure.” One of the report’s key recommendations is that the present system of national accounts should be “rapidly upgraded to include the value of changes in natural capital stocks and ecosystem service flows.” The TEEB report consciously encourages the use of banking and accounting terminology with regard to biodiversity: Its authors have launched a “Bank of Natural Capital” website to encourage wider awareness of the ideas it raises.

Capital in the Twenty-First Century
by Thomas Piketty
Published 10 Mar 2014

For instance, if a natural disaster destroys a great deal of wealth, the depreciation of capital will reduce national income, but GDP will be increased by reconstruction efforts. 19. For a history of official systems of national accounting since World War II, written by one of the principal architects of the new system adopted by the United Nations in 1993 (the so-called System of National Accounts [SNA] 1993, which was the first to propose consistent definitions for capital accounts), see André Vanoli, Une histoire de la comptabilité nationale (Paris: La Découverte, 2002). See also the instructive comments of Richard Stone, “Nobel Memorial Lecture, 1984: The Accounts of Society,” Journal of Applied Econometrics 1, no. 1 (January 1986): 5–28.

Making the Modern World: Materials and Dematerialization
by Vaclav Smil
Published 16 Dec 2013

Even for economies with good historical statistics, all pre-World War II GDP estimates are less reliable than their post-1950 counterparts, and for many modernizing economies they are simply unavailable, or amount to nothing but rough estimates: these realities make reliable long-term international comparisons questionable. Moreover, recent GDPs, calculated according to a UN-recommended System of National Accounts, exclude all black market (underground economy) transactions whose addition would boost the total by 10–15% even in the most law-abiding countries, and could double the economy's size in the most lawless settings. But, once again, the most important bias comes from conversion. In order to make international comparisons, national currencies must be converted to a common denominator (usually US$).

The Blockchain Alternative: Rethinking Macroeconomic Policy and Economic Theory
by Kariappa Bheemaiah
Published 26 Feb 2017

This series concerns credit provided by domestic banks, all other sectors of the economy, and non-residents. The “private non-financial sector” includes non-financial corporations (both private-owned and public-owned), households, and non-profit institutions serving households as defined in the System of National Accounts 2008. In terms of financial instruments, credit covers loans and debt securities. The entire data set can be found at: https://​www.​bis.​org/​statistics/​totcredit.​htm 13Fuelled by strong incentives by local governments and a lack of investment options, capital investment over the past three decades has allowed China to build hundreds of new cities in anticipation of accommodating over 250 million rural inhabitants who were to move to urban zones by 2026.

Prosperity Without Growth: Foundations for the Economy of Tomorrow
by Tim Jackson
Published 8 Dec 2016

Some of these measures could be facilitated by forms of citizen’s income, an idea that is now being explored in a variety of nations including Finland, the Netherlands, Canada and Switzerland.35 ‘Fixing’ economics An economy predicated on the continual expansion of debt-driven materialistic consumption is unsustainable ecologically, problematic socially and unstable economically. Changing this destructive dynamic requires the development of robust new economic thinking. Building a new post-growth macroeconomics is an urgent priority. The shortcomings of the conventional system of national accounts (and the GDP as its central measure) are now well documented. The time is certainly ripe to make progress in developing a national accounting framework which provides a more robust measure of social progress and economic performance.36 But the task of fixing economics goes beyond simply adjusting our accounts.

Geek Heresy: Rescuing Social Change From the Cult of Technology
by Kentaro Toyama
Published 25 May 2015

Technocrats like to say that “if it can’t be measured, it can’t be managed,” but this is simply not true. Most of us manage our relationships with friends and family without measurement. (And you’d worry about anyone who needed metrics to manage relationships.) Many countries have experienced dramatic economic growth well before they have had a system of national accounts.56 Surely, Homer thought of his Iliad as much more than 15,693 lines of dactylic hexameter. The important thing is to establish meaningful goals first, whether or not they can be measured. Where direct metrics don’t exist, there might be indirect proxies. And where there aren’t proxies, there should be a judicious weighing of measurable and unmeasurable factors.

Extreme Economies: Survival, Failure, Future – Lessons From the World’s Limits
by Richard Davies
Published 4 Sep 2019

Researchers examining the impact of disasters use data from the publicly available Emergency Events Database (EM-DAT) compiled by the Centre for Research on the Epidemiology of Disasters (CRED) at www.emdat.be. Petty, Stone and GDP William Petty’s works are set out in his 1662 book on taxation and in his 1676 Political Arithmetick; his contribution to the development of systems of national accounts is traced in Kendrick (1970) and more recently in Davies (ed.) (2015). While other economists – notably Simon Kuznets in the US – helped develop modern GDP measures, Richard Stone was arguably the most important, winning the Nobel Prize for his work in 1984. His contribution is discussed in Johansen (1985) and much more detail on all the various contributors is set out in Studenski (1958), while an accessible modern history is Coyle (2014).

The Great Divide: Unequal Societies and What We Can Do About Them
by Joseph E. Stiglitz
Published 15 Mar 2015

The 99 percent’s boat was sinking, or at least not doing very well. Meanwhile, the other ship was sailing magnificently. Piketty showed that the United States was not alone: similar patterns could be seen elsewhere. Economists had misinterpreted what was happening in the aftermath of World War II. Simon Kuznets, one of the founders of our system of national accounts (by which we measure the size of the economy), who received a Nobel Prize in 1971, had suggested that after an initial period of growth, in which there was an increase in inequality, as economies became richer they became more equal. Experiences since 1980 have showed that this was not true.

Overwhelmed: Work, Love, and Play When No One Has the Time
by Brigid Schulte
Published 11 Mar 2014

If time is money, they say, then documenting how much time women spend caring for children, the elderly, and the sick, driving car pools, overseeing homework, picking up dirty socks, washing dishes, and the like is one way to show its value.15 In 2012, Colombia became the first country to pass a law to include a measurement of unpaid household work in their System of National Accounts.16 * * * In the University of Maryland conference room, John Robinson pronounces my little black notebooks unreadable and slides them across the table back to me, unanalyzed. I had meant to type up the contents and analyze them myself first. But it was such a laborious process that I’d had time to make it through only one week.

People, Power, and Profits: Progressive Capitalism for an Age of Discontent
by Joseph E. Stiglitz
Published 22 Apr 2019

(Gross investment is that part of a country’s output that is spent on new plant and equipment and housing, thought of as the productive assets of an economy. It does not include inventory accumulation, nor does it take account of depreciation, the decrease in productive assets as a result of use or time. It doesn’t include land purchases either.) The official series in the system of national accounts is referred to as the Gross Fixed Capital Formation. 5.Some of the difference, but only some, is a result of a slower growth rate of population. Per capita income growth slowed from 2.3 percent to 1.7 percent. There are also other factors that may have contributed to slowing growth—for instance, the change in the structure of the economy from a manufacturing to a service-sector economy.

Radical Uncertainty: Decision-Making for an Unknowable Future
by Mervyn King and John Kay
Published 5 Mar 2020

One of the authors was employed on the Cambridge Growth Project to build one of the earliest econometric models of the UK economy. Such models usefully emphasise that different parts of the economy cannot evolve in totally separate ways. They capture accounting constraints which ensure that spending on consumption, investment, exports and by government must add up to total national income and output. The system of national accounts which was developed and adopted around the world from the 1930s to the 1950s still provides an indispensable framework for organising and understanding economic data. But the Cambridge Growth Project model could not explain changes in wages and prices, nor short-run movements in the level of total output.

Material World: A Substantial Story of Our Past and Future
by Ed Conway
Published 15 Jun 2023

As policymakers scrambled to come up with answers, they realised that they didn’t even have a practicable picture of the way things worked today. There is an analogy here with the last world war: in a bid to understand the resources at their disposal, in the 1940s policymakers at the US Department of Commerce commissioned an economist, Simon Kuznets, to come up with a system of national accounts. It gave rise to what we today know as gross domestic product. In the 2020s, as it pondered whether it could achieve ‘semiconductor sovereignty’, the same department ordered a survey of the entire silicon-chip supply chain. As they charted the links and connections from mine head to wafer manufacture to fabrication plant and the constellation of essential inputs along the way, they began to create a primitive map of this corner of the Material World.