16 March 2018

Free Exchange: Are we suffering from a growth delusion?


In this week’s Spring Statement, Philip Hammond described himself as “positively tiggerish” about the economic news he was delivering to the House of Commons. His upbeat mood was, in large part, thanks to a minuscule uptick in the Office for Budget Responsibility’s growth forecasts for the next five years.

It’s a reminder of just how central GDP is to the decisions politicians and policymakers make, as well as just how little thought most of us put into what is behind this all-important number.

That makes this week the perfect time to talk to David Pilling, the Financial Times’s Africa Editor and the author of The Growth Delusion. David thinks there is a major problem with how we measure growth. In fact, he goes further. It’s not just we are getting the measurements wrong, it’s that we are too slavishly devoted to growth in the first place.

For this week’s episode of Free Exchange, I spoke to David at the FT’s offices about what really goes into the most important number in economics, and how we could possibly be too focused on growth when it raises living standards and allows us to live longer happier lives.

You can listen to the full episode here, or subscribe via iTunes.

Oliver Wiseman is Editor of CapX.