National accounting systems are the backbone of economic policy making. They express collective value judgements and guide political decision-making. Existing, GDP-based systems were already seen as questionable prior to COVID. Corona has conclusively shown their inadequacy. Besides their blindness to sustainability concerns, they conceal highly variable degrees of economic insecurity and resilience of (i) households, (ii) in essential sectors like care and healthcare, food, and energy, and (iii) of public balance sheets and the macroeconomy. Finally, they fail to align with public perceptions of value.

In response, national accounting systems could be updated in at least five ways. First, the methodology for valuing care work and other essential sectors could be amended via more adequate imputation methods to bring the quantified valuation of these sectors into line with our considered social esteem of them. Second, more detailed and disaggregated data, in particular by gender and ethnicity, should be collected to enable the discussion and implementation of fairer policies after Corona. Third, the production boundary should be identified more clearly as a political question. In particular, and linked to the idea of reducing leverage, finance could be reclassified as an intermediary input — its classification between 1968 and 1993 — so that growth in finance is netted out in the final calculation of GDP, rather than boosting overall GDP levels. Third, proper public balance sheet accounting could be introduced, differentiating between social, financial and commercial assets to render visible both the build-up and the depletion of our collective assets. Fourth, systematic measures of economic insecurity and resilience should be developed both for public and private balance sheets, to have a better understanding not just of current activity levels and asset positions, but also of vulnerabilities and exposure to shocks.

Given the centrality and complexity of national accounting systems, further research and elaboration is required. This could explore a more fundamental rethink of the indicators guiding economic policy, away from the size of economic production and towards more direct measures of ultimate goals, such as resilience, sustainability, and human flourishing. The Stiglitz-Sen-Fitoussi commission, the OECD High-Level Expert Group on the Measurement of Economic Performance and Social Progress, and the UN’s Sustainable Development Goals provide starting points for further inquiry.

This proposal links to the European Investment Authority, Strengthening the Secondary Mandate, Onshoring Essential Industries, expanding Universal Basic Services, and the Sustainability and Prosperity Pact as institutions or practices that could draw on revised national accounting systems.