Yale Economics Professor Awarded Grant from The Glaser Foundation

William D. Nordhaus, the Sterling Professor of Economics at Yale, has been awarded a $1.3 million grant from The Glaser Foundation.

William D. Nordhaus, the Sterling Professor of Economics at Yale, has been awarded a $1.3 million grant from The Glaser Foundation.

The Foundation was established by Rob Glaser, founder and CEO of RealNetworks, Inc. and a 1983 graduate of Yale College.

The grant will support a program on non-market accounts and will develop a prototype set of non-market accounts for the United States. The two-year grant is the leading edge of the Foundation’s program, “Progress Definition and Measurement,” which is designed to develop and implement better measurements for tracking the nation’s progress and economic activity. The grant to Yale will launch an effort to improve measurement of those parts of economic and social activity that are outside the boundary of the market place. The effort will review existing studies, lay out a program for the next decade, describe and oversee collection of the necessary data and oversee construction of the first prototype accounts.

Among the most important areas to be studied are improved measurement of the contribution of the environment, non-market use of time, the contribution of non-profit and volunteer activities, as well as research and education that take place outside profit-making organizations.

According to Glaser, “Limiting our national accounts to market transactions distorts them as a measure of economic activity and well-being. How we measure progress reflects our values and determines our goals as a society. If we are to build a better world in which to live, we must develop and adopt more accurate and meaningful measurements of progress and economic activity.”

Nordhaus added, “This activity is essential to broadening our understanding of economic activity, because so much of what is important to our society takes place in near-market and non-market activities. Our economic measuring rod is defective because it omits many worthwhile activities that take place outside the market and includes many activities that do not truly contribute economic welfare to the population. We hope that a systematic program of research, data collection and construction of new measures can provide a fuller picture of the economic state of the nation.”

Throughout his research career, Nordhaus has pioneered new approaches to the measurement of economic activity. In 1972, he and Nobel laureate James Tobin, the Sterling Professor Emeritus of Economics at Yale, published “Measure of Economic Welfare,” which was one of the first attempts to develop non-market accounts. From 1994 to 1999, Nordhaus chaired a panel of the National Academy of Sciences which reported on environmental accounting, published in “Nature’s Numbers: Expanding the National Economic Accounts to Include the Environment.”

The Glaser Foundation (www.glaserfoundation.org) awards grants to non-profit organizations working on new ways to define and measure progress. In addition, the Foundation funds animal advocacy and socially-conscious media.

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Gila Reinstein: gila.reinstein@yale.edu, 203-432-1325