Our understanding of the world around us is shaped by the numbers we use to measure it.
Official statistics’s objective are to measure and to describe this reality – whatever this is – and its transformation. Concepts and survey methods are tools helping to do this.
These tools are themselves changing and developing through time and so is our understanding of the world. This quite complex interrelation is best understood by studying the history of statistics.
Three new books focus on this topic.
Zachary Karabell, The Leading Indicators: A Short History of the Numbers That Rule Our World, Simon&Schuster 2014
A short excerpt from the introduction:
‘For almost a century, people have been inventing statistics to measure our lives, and since the middle of the twentieth century, our understanding of the world has been integrally shaped by those numbers. Our statistical map, however, is showing signs of age. In our desire to have simple numbers to make sense of a complicated world, we forget that our indicators have a history—a reason that they were invented in the first place—and that history reveals their strengths and limitations just as our own personal histories do. Knowing how we came to live in a world defined by a few leading indicators is the first step to assessing whether we are still well served by them. ….. The temptation, then, is to find new formulas, better indicators, new statistics. The search for better numbers, like the quest for new technologies to improve our lives, is certainly worthwhile. But the belief that a few simple numbers, a few basic averages, can capture the multifaceted nature of national and global economic systems is a myth. Rather than seeking new simple numbers to replace our old simple numbers, we need to tap into both the power of our information age and our ability to construct our own maps of the world to answer the questions we need answering.’
Diane Coyle, GDP. A brief but affectionate history, Princeton University Press. 2014
‘GDP is the way we measure and compare how well or badly countries are doing. But this is not a question of measuring a natural phenomenon like land mass or average temperature to varying degrees of accuracy. GDP is a made-up entity. The concept dates back only to the 1940s. ….
Yet the primacy of GDP as the measure of economic success has been increasingly challenged, not so much by politicians or economists as by people who see it as the primary symbol of what’s gone wrong with the capitalist market economy. For example, environmentalists believe it leads to an overemphasis on growth at the expense of the planet, “happiness” advocates think it needs to be replaced with indicators of genuine well-being, and activists such as those in the Occupy movement argue that a focus on GDP has disguised inequality and social disharmony.
There are certainly several reasonable critiques of GDP and the role it has come to play in guiding economic policy. These also include questions about how complicated the statistical construction of GDP has become, and what such a complex abstraction can actually mean. But GDP is also, as this book will show too, an important measure of the freedom and human capability created by the capitalist market economy. GDP indicates, although imperfectly, innovation and human possibility. And it is an important measure of our creativity and care for one another in an economy based more and more on services and intangibles. In 2000, the U.S. Bureau of Economic Analysis declared GDP to be “One of the Great Inventions of the 20th Century.” It is an understandable exaggeration.
This book explains GDP and describes its history, sets out its limitations, and defends it still as a key indicator for economic policy. It is certainly a better indicator than some of the fashionable alternatives (like “happiness”) that have been proposed. I also ask whether GDP alone is still a good enough measure of economic performance—and conclude not. It is a measure designed for the twentieth-century economy of physical mass production, not for the modern economy of rapid innovation and intangible, increasingly digital, services. How well the economy is doing is always going to be an important part of everyday politics, and we’re going to need a better measure of “the economy” than today’s GD.’
Philipp Lepenies, Die Macht der einen Zahl. Eine politische Geschichte des Bruttoinlandsprodukts, Suhrkamp 2013
A political history of GDP …
Aus der Einleitung: