GDP doesn't measure happiness


Policy makers seem to focus solely on improving imperfect oversimplified metrics like GDP, the stock market index, and the unemployment rate despite the fact that they have very little to do with the well-being of average Americans. It's almost as if policy makers care more about businesses and rich people (shocker, right?).

GDP is such a piss-poor metric that I'd argue that we shouldn't even pay serious attention to it or strive to maximize it. Open source software, technological advancements, free stuff (eg. Wikipedia), and free labor (eg. volunteering, a mother raising her kids) don't increase GDP. Proprietary software boosts GDP more than open source software despite the fact that the latter is more beneficial to society. GDP also doesn't factor in externalities (eg. pollution) and changing demographics. Music industry sales have tanked almost 50% over the last 9 years, yet there is now more music available than ever before and it's all freely available (eg. Youtube, Soundcloud, Spotify, pirating). GDP also doesn't take into account how that wealth is distributed (Gini coefficient does that).

The unemployment rate (U-3) is also a piss-poor metric that's often cited by bigwigs in the media to defend the state of the economy ("unemployment is down to 5%, we're doing fine!"), but that metric classifies underemployed part-time workers as employed, doesn't take into account labor participation, and doesn't in any way measure the quality of jobs (eg. wages).

Poor people aren't affected by the stock market because they don't have any savings.

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We need to start focusing on a broader set of better metrics that actually measure the state of average Americans.

Things like median income, median wealth, free time, social mobility, happiness, education, disposable income, hours worked, health, government participation and contentment with the government, Gini coefficient etc.

Just because a metric can't easily be quantified (eg. happiness) doesn't mean we shouldn't strive to improve it.

Stealing a comment from the Reddit thread:
"A weakness of human nature is that we tend to overemphasize things that can be measured precisely and easily. Money is extremely easy to measure -- we know exactly how much we have down to the cent -- so people often spend too much effort making that number grow at the expense of other factors that can't be measured precisely, like happiness.  
We can see the same phenomenon in many different places, like managers who prefer to do actions that have a measurable but minor effect on the bottom line over actions that would have larger but hard to measure effects. Or well-off people whose schedule is already too tight choosing to do more overtime, sacrificing the spare time they lack (but with a value that's hard to measure) to get more money they don't really need."
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Let's start focusing on improving the things that matter. GDP isn't one of them.

The world is such a complex place that it will unfortunately never be accurately or usefully summarizable within a single number.

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