Measuring and Promoting Wellbeing How Important Is Economic Growth? Essays in Honour of Ian Castles AO and a Selection of Castles’ Papers

Measuring and Promoting Wellbeing How Important is Economic Growth? Essays in honour of Ian Castles AO and a selection of Castles’ papers

Edited by Andrew Podger and Dennis Trewin for the Academy of Social Sciences in Australia. Published by ANU Press The Australian National University Canberra ACT 0200, Australia Email: [email protected] This title is also available online at http://press.anu.edu.au

National Library of Australia Cataloguing-in-Publication entry

Author: Podger, A. S. (Andrew Stuart), author.

Title Measuring and promoting wellbeing : how important is economic growth? : essays in honour of Ian Castles AO and a selection of Castle’s papers / Andrew Podger and Dennis Trewin.

ISBN: 9781925021318 (paperback) 9781925021325 (ebook)

Series: Australia and New Zealand School of Government monograph.

Subjects: Castles, Ian. Festschriften--Australia. Economic development--Social aspects. Economic development--Sociological aspects. Quality of life--Economic aspects. Well-being--Economic aspects.

Other Authors/Contributors: Trewin, D. J. (Dennis John), 1946- author.

Dewey Number: 306.3

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying or otherwise, without the prior permission of the publisher.

Cover design by Nic Welbourn and layout by ANU Press

Printed by Griffin Press

Preface ...... ix Andrew Podger and Dennis Trewin Contributors...... xi 1 . Economic Growth, Wellbeing and Protecting the Future: An Overview of the Castles Symposium...... 1 Andrew Podger, Dennis Trewin, William Gort

Part One: The Role of Economics in Defining and Promoting Wellbeing 2 . Economic Growth and Wellbeing: Ian Castles’ Contribution . . 21 Michael Keating 3 . Ian Castles: Scholar as Truth Teller...... 29 William Coleman 4 . Economics and Anti-Economics...... 39 Ian Castles 5 . Economic Growth: Is it Worth Having?...... 107 Ian Castles and Treasury

Part Two: Measuring Real Income and Wellbeing 6 . Measuring Progress: The International Context ...... 163 Brian Pink, Sue Taylor and Hannah Wetzler 7 . The Four Approaches to Measuring Wellbeing...... 191 John Hawkins 8 . The Need for Wellbeing Measurement in Context . . . . . 209 David Gruen and Duncan Spender 9 . The Wellbeing of the Australian People: Comments on the Treasury’s Framework...... 223 Jonathan Pincus 10 . Subjective Wellbeing and the Mismeasure of Progress. . . . 243 Richard Eckersley 11 . Measuring Wealth and Welfare: Why HDI and GPI Fail. . . . 253 Ian Castles 12 . Measuring Economic Progress: From Political Arithmetick to Social Accounts...... 271 Ian Castles 13 . The Mismeasure of Nations: A Review Essay on the Human Development Report 1998...... 281 Ian Castles 14 . Measuring Economic Progress...... 297 Ian Castles 15 . Reporting on Human Development: Lies, Damned Lies and Statistics...... 341 Ian Castles 16 . International Comparisons of GDP: Issues of Theory and Practice...... 369 Ian Castles and David Henderson

Part Three: Measuring Inequality 17 . What Can We Learn from International Evidence on Trends in Income Distribution?...... 399 Henry Ergas 18 . Changes in Inequality in Australia and the Redistributional Impacts of Taxes and Government Benefits...... 423 J Rob Bray 19 . What Difference Does Government Make? Measuring Redistribution in a Comparative Perspective...... 477 Peter Whiteford 20 . Money Income Distribution and Redistribution in Australia, Sweden and the United States 1984...... 517 Ian Castles 21 . Living Standards in Sydney and Japanese Cities: A Comparison...... 577 Ian Castles

Part Four: Climate Change and Limits to Growth 22 . Climate Change and Related Issues: Ian Castles’ Contributions in Perspective ...... 609 David Henderson 23 . Addressing Wellbeing in the Long-Term: a Review of Intergenerational Equity and Discount Rates in Climate Change Analysis...... 629 Mark Harrison 24 . Limits to Growth … Again ...... 663 Jeff Bennett 25 . Scientists, Statisticians and the Prophets of Doom . . . . . 673 Ian Castles 26. Global Warming and the ‘Scientific Consensus’ 1939–2001.683 Ian Castles 27. Ian Castles and the IPCC – Selected Letters ...... 693 28 . The Stern Review: A Dual Critique...... 721 Part I: The Science Robert M Carter, CR de Freitas, Indur M Goklany, David Holland and Richard S Lindzen Part II: Economics Aspects Ian Byatt, Ian Castles, Indur M Goklany, David Henderson, Nigel Lawson, Ross McKitrick, Julian Morris, Alan Peacock, Colin Robinson and Robert Skidelsky