In helping developing countries to increase their economic prosperity, says Acton’s Jordan Ballor, we must remember that human welfare cannot be reduced to material realities.

If a nation were to pursue GDP growth as its highest goal, it would probably institute policies and incentives to induce women to work outside the home and professionalize child care. GDP incentivizes specialization and the division of labor, since such transactions are the only things taken into account. As Ritenour concludes, “We ought not give into the temptation that all of human welfare is encapsulated in GDP.” Or in other words, man does not live on GDP per capita alone.

In a subtle way, measuring GDP can give the illusion that human flourishing is identical to economic growth and that economic growth is reducible to GDP. GDP is a useful, if limited, measure. But it should never be seen as a direct proxy for economic development, much less human flourishing.

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