The Meaning and Measure of Economic Progress

The cross-relationship between culture & technology is discussed & the values, inherent limitations, & pitfalls in the prevailing model of econ progress are assessed. Econ progress can be understood as meaning: (1) an increase in the capability of a society to produce higher-valued goods & services; (2) an increase in the capacity of a society to provide more real income to its members; (3) a rise in material well-being & a consequent improvement in the quality of culture. It is stated that measuring the latter would be the most meaningful, but no quantifiable index has been devised for this so far. If it could be measured it would have to embody more than, & transcend, the impact of 'econ' progress alone. It would, for example, have to measure improvement in the capability for soc management of the resources of the economy, instead of productive output alone. Some efforts have been made to develop indices measuring the contribution of selected inputs to technological progress. Another useful item would be the development of a labor-productivity function which would work from industry or sectoral productivities, projecting them into the anticipated pattern(s) of end product outputs, considering the consequences of output changes on the gap between 'best technical practice' & the industry average, as well as taking into account the barriers to & checks upon expansion within a given time period. In conventional statistical methods for the measurement of labor productivity, the resources used to produce higherquality manpower are not counted as inputs affecting the measurement of productivity. This is considered as one of the shortcomings of present-day indices of econ progress. Another complication in measuring productivity as a ratio of product output to resource input is that not all current inputs relate to current output, while current outputs must be accounted for in part by reference to inputs made in the sometimes distant past. It is suggested that in non-socialist societies the nat'l economy can be divided into (a) the enterprise, (b) the pol'al, (c) the household, & (d) the instit'al subeconomies. Various other problems of measurement encountered are considered. It is concluded that the measures of productivity & econ growth are not & cannot be more than a clue in the assessment of econ progress. This clue in itself must be perpetually interpreted & re-evaluated by reference to the circumstances to which the measurement refers. M. Maxfield.