Measuring welfare beyond GDP

Gross Domestic Product (GDP) is often treated as shorthand for national economic well-being, even though it was never intended to be; it is a measure of (some) of the marketable output of the economy. This paper reviews several developments in measuring welfare beyond GDP that were recently presented at the Economic Statistics Centre of Excellence (ESCoE) annual conference in May 2019. The papers discussed fall into three broad areas.

Is An 'Englishman's Home' His Pension?

This research project considers whether buying houses may reduce long-term savings in the UK economy. This may explain the UK’s relatively low investment rate and weaker productivity performance over the long term. The study has two parts. First, we present new evidence on the saving behaviour of UK households showing that buying a house with a mortgage results in a lower saving rate, which is likely to mean less pension savings. Second, we examine the consequences for the UK of shifting the allocation of saving from housing and towards business investment.