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Economic Well-being and British Regions: The Problem with GDP Per Capita

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  • David Harvie
  • Gary Slater
  • Bruce Philp
  • Dan Wheatley

Abstract

Economists and policy-makers often present per capita gross domestic product (GDP) as by far the most significant indicator of economic well-being. Such measures are frequently adopted in making international comparisons, constructing time-series for particular countries and in studies of regional inequality. In this paper we challenge this view using a regional analysis of 2001 data focusing upon differences between London and the south-eastern regions, in comparison to the rest of Great Britain (GB). Initially GDP per capita is decomposed into the demographic and labour-market factors which generate it. Thereafter we broaden the notion of work-time used in productivity measures to include other necessary work-related activity, namely commuting. This leads to us to construct a new indicator which we call social productivity. Our conclusion is that our decomposition and notion of social productivity are both relevant in comparisons of regional well-being; in addition such methods may be used fruitfully in international and historical contexts.

Suggested Citation

  • David Harvie & Gary Slater & Bruce Philp & Dan Wheatley, 2009. "Economic Well-being and British Regions: The Problem with GDP Per Capita," Review of Social Economy, Taylor & Francis Journals, vol. 67(4), pages 483-505.
    • Handle: RePEc:taf:rsocec:v:67:y:2009:i:4:p:483-505
    DOI: 10.1080/00346760802245383
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    1. Bruno Frey & Alois Stutzer, 2014. "Economic Consequences of Mispredicting Utility," Journal of Happiness Studies, Springer, vol. 15(4), pages 937-956, August.
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