GDP as Development Indicator and the Challenges of Actualising SDG 8: Inclusive and Sustainable Economic Growth

Abstract

The paper is a conceptual review of the GDP as a measure of economic, national well-being and development sustainability and proposal for adoption of Social Progress Index as a better measures of sustainable economic growth. The study adopted secondary data analysis design and thematic approach to address the pertinent issues raised in the discourse. The overwhelmingly imperativeness to evolve new models, indicators and measures with broader views and coverage around long–term, sustainable socioeconomic and environmental development issues after about 87 years of inaccurately applying the GDP to measure what it cannot measure; The work demonstrated that there should be a preferred substitute of the Social Progress Index (SPI) to the GDP because of its inability to measure national well-being and development. It strengthens the call for Policy Makers, Public Financial and Economic Institutions Managers, and Development Partners to de-emphasise the use of GDP as the determinant for all socio-economic and development policy decisions as it was not designed to do that. The study recommends that a new formula, SPI be adopted for measuring economic growth and national well-being, one which makes for the shortcomings and limitations of the GDP be adopted: EP&NW = GDP (C + I + G + XN) + SPI (B + F + O).

Received: 6 January 2022 / Accepted: 17 October 2022 / Published: 5 November 2022