Nicolas Sarkozy called for a "great revolution" in the way national wealth is measured today, throwing his weight behind a report which criticises "GDP fetishism" and prioritises quality of life over financial growth.
Speaking days before the G20 summit in Pittsburgh, France's president urged the rest of the world to follow his example as he ordered a shake-up in research methods aimed at providing a more balanced reading of countries' performance.
Endorsing the recommendations of a report given to him by Nobel prize winners Joseph Stiglitz and Amartya Sen, he said governments should do away with the "religion of statistics" in which financial prowess was the sole indicator of a country's state of health.
"For years statistics have registered an increasingly strong economic growth as a victory over shortage until it emerged that this growth was destroying more than it was creating," said Sarkozy in a speech at the Sorbonne. "The crisis doesn't only make us free to imagine other models, another future, another world. It obliges us to do so."
Arguing that gross domestic product (GDP) – the standard means of measuring a country's economic growth – ignores other factors vital to the well-being of its population, the report proposes a new indicator which would be calculated with GDP but take into account a broader view.
A new indicator would look at issues such as environmental protection and work/life balance as well as economic output to rate a country's ability to maintain the "sustainable" happiness of its inhabitants.
"Our economy is supposed to increase our well-being; it is not an end in itself," said Stiglitz at the launch of the report, commissioned by Sarkozy last year. "GDP statistics were introduced to measure market economic activity. But they are increasingly thought of as a measure of societal well-being, which they are not."
Asking France's national statistics body, Insee, to update its methods in accordance with the report's recommendations, Sarkozy said he would use future summits such as next week's G20 to persuade other countries follow suit. "France will put this report on the agenda of all international meetings," he said.
France, whose economic output has fallen in the decades since the end of the prosperous "trente glorieuses" (1945-1975) prides itself on other aspects of life. Its healthcare system has been ranked the world's best by the World Health Organisation, its comparatively short working week is legendary, and its fertility levels are the highest in Europe, along with Ireland's.
"Economic resources are not all that matter in people's lives," said Angel Gurría, secretary general of the Organisation for Economic Cooperation and Development. "We need better measures of people's expectations and levels of satisfaction, of how they spend their time, of their relations with other people in their community."
Using the traditional measure, the European commission today forecast that the eurozone will grow by 0.2% in the third quarter as the continent's biggest economies recover from the worst recession in decades. In its latest economic outlook, the commission predicted the economy would grow by 0.2% between July and September and by 0.1% in the final quarter of the year.
However, it did not change its forecast that the eurozone's GDP would fall by 4% in 2009 as a whole because the economy fared worse at the end of 2008 and the beginning of this year.
