Beyond the Market Designing Nonmarket Accounts for the United States (2005) / Chapter Skim
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Executive Summary
Executive Summary
Pages 1-8
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From page 1... ...
Researchers now must supplement data from the national accounts with external estimates of the contributions of research and development, natural resources, and investments in human capital. These limitations of national accounting data reflect the reality that neither economic production nor contributions to social welfare stop at the market's border, but extend to many nonmarket activities.
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From page 2... ...
Though one objective of nonmarket accounting is to support alternative aggregate measures of economic performance, satellite accounts are not intended to replace the current national accounts but to exist alongside them. Most of the work proposed by the panel would be conducted on an experimental basis and would not change the way the headline GDP is estimated.
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From page 3... ...
Although gross domestic product includes expenditures for education, it fails to adequately capture the contribution of related nonmarket activities to future economic growth, the well-being of individuals, and society in general. Because human capital, particularly that arising from education, is such a large component of the capital stock, a separate education account would contain essential data for improving research on investment, capital, and ultimately economic growth as measured by the traditional accounts.
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From page 4... ...
In addition to the five areas of nonmarket activity identified in this recommendation, the report includes a chapter on the role of the family in human capital development. Though something is known about the magnitude and the value of family inputs to human capital creation, the panel concluded that, given the current state of knowledge and data, it would be impossible to develop a comprehensive human capital investment account.
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From page 5... ...
Improved health, for example, may result from better medical care, better education that contributes to better individual decisions about diet and exercise, or improved air and water quality. Nonetheless, the panel sees no realistic alternative to considering the different areas of nonmarket activity separately, but nonetheless recognizes the need to delineate the interactions and complementarities among them as the development of supplemental accounts proceeds.
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From page 6... ...
Recommendation 1.4: A replacement cost measure, adjusted for differences in skill and effort between nonmarket and market providers, should be adopted for valuing time inputs devoted to nonmarket production in cases in which someone else could have been hired to perform the work in question. Where this is not the case, an opportunity-cost-based measure, ideally adjusted to account for the intrinsic enjoyment associated with the activity in question, should be used for valuing time devoted to nonmarket production activities.
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From page 7... ...
Recommendation 2.2: The Bureau of Labor Statistics should commit re sources adequate to improve response rates in the American Time Use Sur vey and to investigate the effects of lower-than-desirable response rates on survey estimates. Demographic data go hand in hand with time-use data in laying the foundation for nonmarket accounts: time-use data can be used to answer questions about what individuals with particular characteristics are doing with their time; demographic data describe the distribution of characteristics in the population.
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From page 8... ...
We offer numerous recommendations on this topic and more generally about the next steps needed in research and data development to advance nonmarket accounting.
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