Yale Economics Professor Awarded Grant from The Glaser Foundation
William D. Nordhaus, the Sterling Professor of Economics at Yale University, has been awarded renewed funding by The Glaser Foundation to continue his program for developing “non-market” or “augmented” accounts for the United States.
The goal of the research is to develop and implement better techniques for tracking the nation’s progress and economic activity in areas that are outside the boundary of the marketplace. Among the most important aspects to be studied are measuring the contribution of the environment, non-market use of time and the impact of research and education that take place outside profit-making organizations.
Nordhaus adds, “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.”
According to the Foundation’s creator, Rob 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.” The Foundation (www.glaserfoundation.org) was established by Glaser, founder and CEO of RealNetworks, Inc., who is a 1983 graduate of Yale College. It awards grants to non-profit organizations working on new ways to define and measure progress.
Working with Nordhaus, the National Academy of Sciences will bring together a group of scholars to undertake background research and lay out the conceptual framework for a set of non-market accounts. This committee will meet over the next two years and is expected to present its report in 2004.
During 2002, a major goal of the project will be the investigation of the state of time-use statistics in the United States to ensure that they are adequate for the development of non-market accounts. In addition, the project plans to begin to work with scholars at Yale and elsewhere to develop a set of environmental and natural-resource accounts for the United States.
Throughout his professional career, Nordhaus has pioneered new approaches to the measurement of economic activity. In 1972, he and the late Nobel laureate James Tobin, Sterling Professor Emeritus of Economics at Yale, published a study “Is Growth Obsolete?” - 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.” One of his most recent studies, “The Health of Nations,” evaluated techniques for analyzing the impact of improvements in health status on income measures and applied this approach to the United States. The surprising result of that study was that improvements in the health status of the population over the 20th century contributed as much to economic welfare as all other goods and services combined.