Alternative economic indicators are metrics used to assess economic performance that goes beyond traditional measures like Gross Domestic Product (GDP). While GDP focuses on the total value of goods and services produced within a country, alternative indicators often try to capture different aspects of economic well-being, such as social progress, informal economy, distribution of wealth etc. Typical examples of alternative economic Indicators are the:
- KFC index which is a way of measuring the purchasing power parity between two currencies and providing a test of the extent to which market exchange rate results in goods costing the same in different African Countries.
- Happy Planet Index that evaluates life satisfaction, life expectancy, and ecological footprint.
- Gender Inequality Index that evaluates gender disparities in reproductive health, empowerment, and labor market participation.
While offering valuable insights, alternative indicators also face challenges related to data availability, standardization, and subjectivity.