The Purse

The GDP measure: why we need to move beyond it. And listen to the podcast interview with Anam Parvez Butt, Head of Research for Oxfam GB

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The GDP measure: why we need to move beyond it. And listen to the podcast interview with Anam Parvez Butt, Head of Research for Oxfam GB

Jana Hlistova

Sep 17, 2023

Welcome to our #203 weekly newsletter.

“For women taking control of their financial future”

-Jana Hlistova

From The Purse

In this week’s newsletter, we spotlight a short extract from The Purse Podcast interview with Anam Parvez Butt, a Pakistani feminist economist who currently works as the Head of Research at Oxfam GB.

We talk about the GDP (gross domestic product) measure, why it is problematic and how we should move beyond it.

Listen to the full interview here.

And you can review the news in brief so you stay on top of global financial, economic and investing trends.

I hope you enjoy this week’s newsletter.

Until next week,

Jana

The GDP measure: why we need to move beyond it

We talk to Anam Parvez Butt on The Purse Podcast about the GDP measure and why we need to move beyond it.

We interviewed Anam Parvez Butt on The Purse Podcast.

Anam is a Pakistani feminist economist who currently works as the Head of Research at Oxfam GB where she works with others to develop and implement Oxfam’s research agendas on care and informal work, fragility and conflict and climate justice.

In particular, the focus areas of her research include gender and macroeconomic policies, the care economy, feminist economic alternatives including metrics that challenge the neoliberal logic of growth, social norms and ending violence against women and girls (eVAWG).

She is deeply committed to integrating intersectional feminist and decolonial approaches in research, learning from and supporting others to do so.

She has co-authored two of Oxfam’s flagship inequality reports including “Time to Care”, the “Care Policy Scorecard” and recently published paper on “Radical Pathways to move beyond GDP”.

In the podcast interview we talk about: the GDP measure: what is it, why this is problematic for women and for women's wealth, why Oxfam has added its voice to move beyond the GDP, the recently published report called ‘Radical Pathways Beyond GDP’, why and how we need to pursue feminist and de-colonial alternatives urgently, and how do we accelerate the pace of change?

Below is a short extract from the interview:

Jana: “…And moving on to why it's problematic, in addition to the inequality and sustainability issues or environmental challenges that we're faced with today- it is especially problematic for women because 65% of women's work on a weekly basis is essentially unmeasured by the GDP.

And this has significant consequences for 50%-51% of the population globally…”

Anam Parvez Butt’s response:

Yes, absolutely. As you said, it's (GDP: gross domestic product) not even a good measure of what it's supposed to measure, which is economic activity.

And the stat that you quoted, which is a really staggering one, that 65% of women's working hours globally are excluded from GDP.

And this is due to unpaid care, which accounts for 45% of all adults working hours each week globally, not being captured in GDP calculations.

Women carry out three quarters of unpaid care globally, nearly 90 billion hours a week, dedicating on average 4.5hrs a day to it compared to 1.02hrs for men.

As well as the low paid informal work that women, particularly black and brown women do, is a hidden subsidy to the global economy, without which the system as we know it would collapse.

We count 1.3 billion women worldwide who do this work and whose effort, contribution, and value is hardly reflected in GDP's definition of the economy.

And why does this matter?

We know that what isn't seen or counted doesn't only impact what is measured, but critically affects policies around what gets invested in and who benefits and loses around the world.

Public care provisions are sorely lacking, pushing women deeper into time and income poverty, even more so for women who are already experiencing inequalities based on race, ethnicity, income, or age.

Only 44% of countries meet the ILO's minimum standard on maternity leave.

In the U. S., which, tops the world in terms of GDP and spent over 800 billion US dollars on its military in 2021.

There is no federal paid leave policy. In other parts of the world, large deficits and basic kind of physical infrastructure, piped water, electricity, sanitation continue to persist.

In sub Saharan Africa, only 55% of households are within 15 minutes of a water source. And women spend sometimes over four hours a day just collecting water.

And this lack of universal care policy coverage in part rests on this assumption that households and within households, particularly women and girls, will provide these services for free.

And instead of greater investments in these services, we instead see austerity policies, in the form of cuts to public services and employment.

And these are sponsored by the likes of the World Bank and the IMF, and are soon to affect 85% of the world's population and directly harm women who are found facing a triple burden.

Firstly, welfare cuts on which they depend. Then, stepping in to fill the gaps with their unpaid labor. And then thirdly, cuts to jobs and pay in the public sector where women workers predominantly make up the workforce.

Now, 10 years of austerity in the UK has been accompanied by a fall in life expectancy among women in the most deprived areas, largely from minority ethnic and racial groups.

One of the key arguments that we make in the report is that it is no surprise or accident that GDP leads to policies that harm women and girls.
Because it is embedded in an extractive, patriarchal, and neocolonial economic system, which, in the words of eco feminist Vandana Shiva, reduces the society to the economy.

The economy to the market and systematically invisibilises and exploits care work, but also nature.

And its a model and way of thinking that creates the sort of artificial symmetry between the market economy and the non market economy, or what, feminist economists call, the maintenance or sustenance economy, which consists of care activities, ecological processes on which all human life depends.

But the market economy is considered the entire economy.

What is productive, what sits inside the primary focus of economic thought and policymaking, whereas the maintenance economy, is considered unproductive, valueless and lying outside of this focus.

And I also wanted to mention that, apart from unpaid care, GDP doesn't tell us anything directly about social and ecological wellbeing at large; our health, our happiness, life satisfaction.

It ignores the value of peace and clean air, in fact, oil spills through cleanup efforts can actually increase GDP whilst not polluting the ocean counts for nothing.
It doesn't distinguish how growth is happening and who it is harming or benefiting. So a dollar spent on coal is valued the same as a dollar spent on public health.

And the environmental cost of burning that coal is not even factored in.

It also takes no account of inequality. A country can have high GDP growth, yet all the benefits accrue to the richest people.

One of the examples we give is of Equatorial Guinea, for instance, which has one of the highest figures for GDP per capita on the African continent, at one point even higher than Spain, I think.

But despite this, primary school enrollment rates remain lower, infant mortality remains higher than the sub-Saharan African average.

And analysis by scholars in the country has shown that this is largely a result of widening inequalities and the capture of GDP by wealthy elites, something that does not feature in, in GDP accounts.

So in summary, it really does a very, very poor job of really measuring what matters…

Listen here to the full interview.

Financial news

Beyond AI euphoria is a worrying stock signal on US growth. Stocks sniffing out something data isn’t showing: Russell 2000 has fallen behind an index of 1000 largest-cap stocks for 2nd month in a row, on track for its second-worst annual underperformance since 1998.
A bank liquidity indicator sounds the alarm. Emergency loans from the Fed's #BTFP facility rose to $108bn this week – a new high – as long-term US government bond yields keep rising.
US Fed quantitive tightening (QT) continues with balance sheet shrank by another $2.5bn to $8,098.8bn, lowest since July 2021. Fed's total assets now equal to 30.2% of US's GDP vs ECB's 51.5%, SNB's 111.5% & BoJ's 126.8%.
The US inflation for August ran a bit hot, with headline CPI coming in at +3.7% YoY above Street’s +3.6% forecast) while the Core CPI was inline on a year-on-year basis (+4.3%, down from +4.7% in Jul) but hot on a MoM view (+0.278% vs. the Street +0.2%).
European Central Bank (ECB) raises rates by 25bps, depo rate to fresh all-time high of 4%.
EU cut its outlook for Eurozone economy, predicting it will be dragged down this year by a contraction in Germany.
UK mortgage war ‘under way’ as lender offers 4.99% fixed rate. Brokers say borrower confidence likely to lift after the first below 5% deal surfaces since June with more offers likely soon.
UK economy shrinks by 0.5% in July amid wet weather and strikes. Manufacturing, services and construction sectors contract for first time since summer of 2022.
Arm Holdings jumps 25% from IPO price in trading debut. Hotly-anticipated IPO was 12-times oversubscribed w/the top 10 clients taking half of the 95.5 million ADRs at $51 each, the top of a marketed range.

Crypto: bitcoin, ethereum, DeFi & NFTs

Bitcoin at $26.4k set for weekly gain, but rallies might continue to be sold. The world's largest crypto has bounced from a 3-month low below $25,000 hit on Monday.
Ethereum (ETH) remains more or less at the same price it was seven days ago at $1,636.
Two tokens rallied: Bitcoin Cash (BCH) grew 11.5% to $213.79, while Toncoin (TON) blew up 23% to trade at $2.20.
On Monday, Sony subsidiary Sony Network Communications announced it was developing a blockchain network in collaboration with crypto tech firm Startale Labs.
American payments giant PayPal launched crypto to USD off-ramps on Tuesday. The move came after PayPal launched a crypto On Ramp integration last month, enabling direct crypto purchases to MetaMask and Ledger users.
On Wednesday, Taurus–a Swiss crypto fintech firm—announced an agreement with Deutsche Bank. Deutsche Bank will also use Taurus’ infrastructure to offer custody and tokenisation services for its customers