By Paul Schreyer
ESCoE Research Director Paul Schreyer reviews Diane Coyle’s latest book ‘The Measure of Progress: Counting what really matters’.
The ways that statisticians and governments measure the economy were developed in the 1940s, when the urgent economic problems were completely different from those of today.
The Measure of Progress offers a thought-provoking critique of traditional economic metrics, particularly GDP and the System of National Accounts (SNA). These metrics, Coyle argues, are inadequate for capturing the complexities of modern economies and fail to provide a satisfactory answer to the question, “Are things getting better, and for whom?”
Why GDP falls short as a measure of progress
Coyle’s critique of GDP is not new, but it is sharply articulated. GDP, she argues, fails to measure societal progress or even economic activity accurately in an economy driven by digitalisation, services, and intangible assets.
However, while she highlights numerous measurement challenges (such as valuing free products, capturing intangible capital, and adjusting for quality changes), I argue that GDP and the underlying National Accounts continue to provide a good tool for gauging macro-economic trends, market incomes, and the key sectors driving activity.
The hidden challenges of measuring modern economies
Much of the book examines how today’s economies have outgrown the frameworks built to describe them. Coyle explores the productivity puzzle (the unexpected and persistent slowdown in the rate of productivity growth since the late 2000s) and the difficulty of capturing gains from process innovations, particularly in public services and digital sectors.
A recurring and powerful theme is time. Technological and service innovations often save time for producers and consumers, yet these welfare gains are invisible in GDP. For instance, when customers do their own online banking, they replace paid labour with unpaid household effort. This creates an illusion of higher productivity without necessarily improving overall efficiency.
Coyle also highlights the effects of digitalisation and globalisation, where production increasingly crosses borders and boundaries between markets and households. Her call for better measurement of household production and digital trade aligns with recent updates to the 2025 System of National Accounts, which acknowledges these issues explicitly and provides an internationally agreed measurement framework.
New approaches: Comprehensive wealth and time-use accounting
To go beyond GDP, Coyle proposes two alternative frameworks: comprehensive wealth and time-use accounting.
Comprehensive wealth broadens the focus from produced capital to include natural, human, and social capital, capturing sustainability and intergenerational equity more directly. However, I argue that valuing these diverse forms of capital is extremely complex. Assigning “shadow prices” to trust, ecosystems, or future environmental risks stretches the limits of statistical feasibility. Many of the measurement challenges identified with GDP would not only persist but become even more pronounced when targeting comprehensive wealth.
Coyle’s second proposal, a time-use accounting framework, recognises that time is a fundamental constraint in all economic activity. Incorporating time use into National Accounts could help reveal the full economic contribution of unpaid work, care, and digital activities. Encouragingly, this idea has already gained traction: the 2025 System of National Accounts now provides international standards for measuring household non-market production and time allocation. Read about recent ESCoE work on time use.
Updating economic statistics for the digital age
Coyle describes the System of National Accounts as a framework rooted in the 1940s. However, this framework has evolved considerably. For example, the latest 2025 updates integrate new tools to measure digitalisation, sustainability, and material well-being: for the first time, distributional information will be built into our National Accounts. Balancing innovation with global consistency is a major achievement, and our understanding of economies would be far poorer without these statistical foundations.
Still, Coyle’s broader message resonates: to measure progress effectively, official statistics need more investment, better data, and renewed ambition.
Summary
Diane Coyle’s The Measure of Progress is a timely and thought-provoking contribution to the debate on how we measure economic and social well-being. It is accessible, rigorous, and rich in examples that challenge economists and policymakers to think beyond GDP.
Measuring progress has never been simple, but as Coyle convincingly shows, understanding what truly drives prosperity and sustainability requires re-examining the metrics we rely on.
ESCoE blogs are published to further debate. Any views expressed are solely those of the author(s) and so cannot be taken to represent those of the ESCoE, its partner institutions or the Office for National Statistics.