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| title | chunk | source | category | tags | date_saved | instance |
|---|---|---|---|---|---|---|
| Capability approach | 5/8 | https://en.wikipedia.org/wiki/Capability_approach | reference | science, encyclopedia | 2026-05-05T15:26:13.523216+00:00 | kb-cron |
==== Critique of output-based measures ==== The use of GDP and GNP as an approximation of well-being and development have been critiqued widely, because they are often misused as indicators of well-being and human development when in fact they are only telling about the economic capacity of a country or an average income level when expressed on a per person basis. In particular, feminist economics and environmental economics offer a number of critiques. Critics in these fields typically discuss gender inequalities, insufficient representation of environmental costs of productions and general issues of misusing an output-based measure for unintended purposes. In sum, the conclusion of Capabilities Approach is that people do not just value monetary income, and that development is linked to various indicators of life satisfaction and hence are important in measuring well-being. Development policies strive to create an environment for people to live long, healthy creative lives. Feminist critiques Nussbaum highlights some of the problematic assumptions and conclusions of output-based approaches to development. First, she notes that GNP and GDP do not consider special requirements to help the most vulnerable, such as women. Specifically, Nussbaum mentions that output-based approaches ignore the distribution of needs for the varying circumstances of people, for example a pregnant woman needs more resources than a non-pregnant woman or a single man. Also, output-based measures ignore unpaid work, which includes child rearing and the societal advantages that result from a mother's work. Marilyn Waring, a political economist and activist for women's rights, elaborates on the example of a mother engaged in child care, domestic care and producing few goods for the informal market, all of which are usually done simultaneously. These activities provide economic benefits, but are not valued in national accounting systems; this suggests that the definition of unemployment used in output-based measures is inappropriate. (See the article on Feminist economics, section "Well-being"). Environmental critiques Another critique by Waring is that the output-based measures ignore negative effects of economic growth and so commodities that lower social welfare, such as nuclear weapons, and oil extraction which causes spills, are considered a good input. The "anti-bads" or the defensive expenditures to fight "bads" are not counted as a deduction in accounting systems (p. 11). Furthermore, natural resources are treated as limitless and negative outputs such as pollution and associated health risks, are not deducted from the measures. Technical and misinterpretation critiques When GNP and GDP were developed, their intended use was not for measuring human well-being; the intended use was as an indicator of economic growth, and that does not necessarily translate into human well-being. Kuznets has often made this point, in his words, "distinctions must be kept in mind between quantity and quality of growth, between costs and returns and between the short and long run. Goals for more growth should specify more growth of what and for what" (p. 9). Nussbaum also points out that GNP and GDP omit income distribution and the opportunity or ability to turn resources into activities (this critique stems directly from Capabilities Approach). Kuznets terms this as a problem of "obtaining an unduplicated total of all output", (p. 15) this suggests that people are only seen as consumers and not as potential producers, hence any products purchased by an individual are not seen as "being consumed in the productive process of turning out other goods" (p. 15) These accounting measures also fail to capture all forms of work and only focus on "engagement in work 'for pay or profit'", (p. 133) leaving out contributions to a society and economy, like volunteer work and subsistence farming. Kuznets provides the example of the process by which farmers devote time and energy to bringing virgin land into cultivation. Furthermore, GNP and GDP only account for monetary exchanges, and place no value on some important intangibles such as leisure time.
=== Shift to alternative measures === Capabilities Approach has been highly influential thus far in human development theories and valuational methods of capturing capabilities, the theory has led to the creation of the HDI, IHDI and GII and their uses among international organizations such as the United Nations and others. In companies, capabilities are included in Key Development Indicators, or KDIs as measures of development, including employee development. In 1990 in the Human Development Report (HDR)commissioned by the UNDP set out to create a distribution-sensitive development measure. This measure was created to rival the more traditional metrics of GDP and GNP, which had previously been used to measure level of development in a given country, but which did not contain provisions for terms of distribution. The resulting measure was entitled the Human Development Index, created by Mahbub ul Haq in collaboration with Sen and others. The purpose was to create an indicator of human development, especially one that would provide a general assessment and critique of global human development to shed light on persistent inequality, poverty and other capability deprivations despite high levels of GDP growth. Currently the HDI continues to be used in the Human Development Report in addition to many other measures (based on theoretical perspectives of Capabilities) that have been developed and used by the United Nations. Among these indices are the Gender-related Development Index (GDI), the Gender Empowerment Measure (GEM), introduced in 1995, and the more recent Gender Inequality Index (GII) and the Inequality-adjusted Human Development Index (IHDI), both adopted in 2010.
=== Capabilities-based indices === The following are a few of the major indices that were created based on the theoretical grounds of Capabilities Approach.