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EGALITARIAN | GDP is good but not sufficient

While pursuing the usual economy metric of GDP as a measure of growth, it sits well for Mindanao to consider, review, and put to mainstream the factors that contribute to subjective well-being and quality of life. 

In fact, the global movement to measure development puts aside development and embrace anew the new concepts such as happiness, functionality, green environment, and total well-being. 

The new approach veer away from the economic income and consumption as primary drivers of progress to well-being. Take for example the proposal of Costanza and his colleagues who demonstrate the limits of money, income, and consumption in their contribution to subjective well-being. They have pointed that the pursuit of money is by itself leading to reduction in well-being.

As such, in the classic presentation of Simon Kuznets of the itemized list of things measured by GDP, he mentioned the need to also measure items that contribute to making society good such as the intention to do good and the desire to raise a family. Kuznets proceeded by producing a list of services provided by housewives and other family members, relief, charity, services of owned durable goods, and earnings from odd jobs. 

It can be noted that in developing and slowly-growing economy, GDP growth translates to large return on satisfaction only when the growth dividends are reallocated to improve leisure, environmental quality, and the benefits of communal life as the economist Howarth in 2012 described.

The list, which resonates Mindanao’s economic situation of culture, of history, of communal ownership of the indigenous communities, is a narrow and limited measurement of monetary transactions of producing goods and services. 

Therefore, it is an incomplete picture of the system where which the human activity spring from to create economy. 

In Mindanao, there are remote areas where money is not needed because of the ready access to food, and while gross output is limited, money is awash for economic integration with other areas. Note that on their way, can perhaps be better due to longer lives except when snapped by violent conflicts.

It may seem that the present economic policies do not contribute to overall improvement in the subjective well-being, and have relegated the goal of happiness to the sideline. 

The expansion has led to pursue positional goods than true welfare goods.

The environment has a substantial role to maintaining quality of life, however, their true measure was not included. The contingent value of the non-market ecosystem services was estimated at $33 trillion per year. 

This is a substantial amount that is reduced every year due to pursuit of the measure of GDP.

Assessing the real economy, as it is applicable to other countries as it is also to Mindanao, is to include relevant ingredients of true, sustainable well-being, in addition to market economy. 

Such that, there is the need to measure the non-market goods and services —human welfare with nature, sanctity of family, value of social relationship including history and culture, health & education– in the measurement of the final goods and services.

And if we are to elevate for broader categories, the strongest human needs are security, economic well-being, a sense of belonging, recognition and control over one’s life as Harvard professors Fisher & Ury enumerated, these list being the strongest motivation to live can be achieved not by more money but more meaningful engagement with self and others.



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