Meaning and Measurement of National Economic Success: UK Relative Economic Performance in the 1980s

Abstract

Overall assessments of national economic performance involve a set of well rehearsed 'technical' problems. They are also always mediated by the ideological stance and the committed analytical or policy position of the observer. In this paper we introduce a framework for such overall assessments which both takes account of the major problems and, by making these subjective dimensions explicit, demonstrates their significance. Drawing on the approach of the UN Human Development Index, a composite index of national economic performance is developed. Using a set of conventional macroeconomic indicators we calculate composite indices of UK economic performance, relative to the G7 as a whole, in the 1980s compared to the 1970s from four different analytical or ideological standpoints. The results illustrate, inter alia, the extent to which assessments of relative economic performance can vary with the position of the observer.