Thursday, September 17, 2009
GDP and the Value of Happiness
France's President Nicolas Sarkozy and economist Joseph Stiglitz trying to start a new trend - using the value of happiness as a component of GDP. Stiglitz led a panel of economists - commissioned by Sarkozy - to look into GDP and whether it was a true measure of a society's health. Stiglitz maintains that GDP statistics often suggest that the economy is doing far better than most citizens' own perceptions. For example, before the credit crisis the US was reporting stellar GDP growth rates, but these were skewed by the massive amount of household debt Americans were taking on to fuel the growth. Sarkozy and Stiglitz argue that happiness, long holidays and a sense of well-being - partly down to having excellent health care - should be part of the measurement of a society's performance. I agree whole-heartedly. Americans live on a knife edge between good quality health insurance provided by their employers and having to use the emergency room and walk on the bill. That causes stress. In France the health care is excellent and paid for by their tax euros. The average American gets two weeks of vacation time each year. Most of them use it in the summer when their children are out of school; that leaves 10 months of the year with only a public holiday here and there. That causes stress too. In France, on the other hand, vacations are long and varied. Most Frenchmen get 6 weeks off plus public holidays. As far as happiness goes, I can't even bear to watch Fox News or CNN for all the vitriol and bile that is spilling out of Americans today. That is not happiness. In France their lifestyle is much the same today as it was 100 years ago - with a focus on good food, fine wines and arguing politics over the dinner table. They do not need the news media to feed them their opinions. In America property prices have fallen between 20-50%. In France property prices have barely dipped (I know this because I check Paris apartment prices weekly and a friend just came back from looking at houses in Provence). I think Sarkozy has something here.