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Measurement and Interpretation of Productivity (1979) / Chapter Skim
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Supplementary Statement
Pages 206-210

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From page 206...
... Advances in knowledge, the diffusion of knowledge, improvements in nutrition and health, changing patterns of family life, elimination of discrimination in its various forms, rising expectations, widening opportunities for citizen participation in economic, political, social, and cultural life, and opportunities for workers to participate through their unions in influencing the quality of life on the job and life off the job-all these factors and many others have impacts on productivity that are difficult to measure, perhaps in some cases impossible to measure, but that are, nevertheless, highly significant. Productivity improvement is not an end in itself.
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From page 207...
... Nevertheless, any accounting system, including existing productivity measures, involves arbitrary Gordian-knot-cutting decisions and acceptance by a broad public depends on confidence in the originators and producers of the system and the index or indicators that come out of the system. I recognize the utility of existing government productivity efforts.
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From page 208...
... There is no satisfactory way of adjusting and measuring capital "input." The paper on welfare dimensions of productivity measurement, prepared for this panel by Milton Moss (in this volume) , raises the kind of issues I am particularly concerned about, including discussion specifically about "quality of life measurement" and "social indicators" and "social accounting" and the "outcome" of social activity, including economic activity.
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From page 209...
... The Moss paper (in this volume) makes a valid distinction between the national economic accounting system's measurement of"final 'real' output of the economy" and the social accounting effort to develop welfare "outcome measures for society as a whole." I agree with the Panel on the desirability of maintaining the distinction between the existing national economic accounts system and a still-to-bedeveloped system of social welfare accounting or goals accounting or "quality-of-life" accounting.
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From page 210...
... To conclude this supplementary statement to the Panel report, I note again that existing economic analysis cannot cope with difficult or impossible-to-measure social outputs and social benefits such as environmental protections and occupational safety and health protections and consumer protections and other social programs that do not have a "measured output" as defined in our existing system of national economic accounts. I urge economists and social scientists generally and productivity researchers in particular to consider the points I have raised as they seek to push out the frontiers of knowledge to lay the foundations for better public policy.
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Key Terms

  • social accounting
  • economic accounting
  • economic accounts
  • productivity measurement
  • social indicators

  • goals accounting
  • labor input
  • panel report
  • productivity researchers
  • arbitrary weighting

  • moss paper
  • productivity measures
  • service sector
  • existing national
  • supplementary statement

  • econometric study
  • advisory subcommittee
  • including economic
  • existing economic
  • draft report

  • welfare dimensions
  • simple framework
  • health protections
  • positive approach
  • income distribution

  • measurement excluding
  • weighted labor
  • valid distinction
  • controlled econometric
  • discussion specifically


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