Total Productive System of an Industrial Society as a Layer Cake

Figure 1: Hazel Henderson's Layer Cake With Icing
Based on Jenny Cameson's

Introduction

How do people measure the health of an economy? Traditionally, economists have used Gross Domestic Product (GDP). GDP is a measure of a nation's aggregate economic output. Environmental activists and feminist economists such as Hazel Henderson and Barbara Brandt claim GDP is not a good measurement of the well-being of a nation [1]. Henderson uses the metaphor of a layer cake to illustrate how GDP ignores the important contributions the social cooperative love economy (such as traditionally feminine work) and mother nature make to society. The cake has four layers: mother nature, the social cooperative love economy, the public sector, and private sector. According to Henderson and Brandt, GDP only calculates the worth of the public and private sectors, and ignores mother nature and the social cooperative love economy.

Monetized Half of the Cake

GDP only measures the top two layers of the cake (the public sector and the private sector). The private sector is defined as the "official market economy" by the mainstream economists, yet it is merely the icing of the cake. The private sector records all cash transactions, such as private companys' employment and investment. The public sector includes military, state and local government, and public infrastructures, such as schools and roads [1]. GDP includes the monetary value of stocks, bonds, employments, schools, roads, military spending, and more; however, it does not include clean air, beautiful forests, family, volunteer work, traditionally feminine unpaid work, and many other unmonetary contributions to society. Imagine a nation without trees, clean water, family, volunteers, etc. Is such a world "healthy?" What is missing in this picture of GDP?

Non-Monetized Half of the Cake

GDP ignores big parts of the production in a nation: traditionally feminine work and mother nature. The bottom layer of the cake is mother earth, whose production and contribution to the society is usually unaccounted for by GDP. Above the mother earth layer is the social cooperative love economy layer that includes "all the cooperative, selfless work we do for each other in communities and families, where no cash is exchanged"[2]. Traditionally feminine work, such as unpaid household and parenting, caring for elderly and sick, and volunteering, are all considered to be in the social cooperative love economy. Both mother earth and the social cooperative love economy are not included in GDP, although they are integral to the functioning and health of our economy and society.

Alternatives to GDP

There are better ways to measure the health of a nation than GDP. Henderson is working with the Calvert group to create standard statistics to measure a nation's well beings that includes the bottom half of the cake. See Calvert-Henderson Quality of Life Indicators site to learn more. In our website, we discuss Genuine Progress Indicator (GPI) as a possible alternative to GDP in measuring the health of a nation.

End Notes:

[1] Jenny Cameron. Feminizing the economy: metaphors, strategies, politics [on-line] (The Community Economies project) available at: http://www.communityeconomies.org/papers/rethink/rethinkp4feminizing.pdf; Internet; Accessed 17 May 2007

[2]Lindsy Van Gelder "It's Not Nice to Mess With Mother Nature - Ecofeminism 101" (Ms.Magazine Spring 2002) [magazine on-line] available at: http://msmagazine.com/spring2002/Ecofeminism.asp; Internet; Accessed 17 May 2007.