The Trouble with Economic Data: Flawed Metrics, Flawed Decisions

·54 min·5 clips

Cambridge economist Diane Coyle argues GDP is a flawed idea from WWII, not a real measure of progress.

The clip opens with a blunt question. If someone has a steady job, a home, and enough food, Shermer asks, why should billionaire wealth matter to that person's life? The guest gives the answer some room. A rich person being rich is not the issue by itself. The issue starts when money becomes clout, and clout starts changing politics and markets. Elon Musk is the test case here. The point is not that every gap between rich and poor is unfair, or that uneven rewards always poison the economy. The guest treats some inequality as part of the deal when innovation, talent, and new businesses create outsized wins. But there is a line where wealth gets so concentrated that it can start changing the rules for everyone else. Technology companies make that worry feel less theoretical. Market power can turn into political influence, and political influence can make the market even friendlier to the companies already on top. That hurts stability, but it also hurts the next wave of growth. New firms need space to enter, compete, and maybe become the next big company. The guest points back to Facebook rising against Myspace, then asks whether that kind of leap is harder now. Shermer keeps pushing the everyday objection. If the middle of the bell curve is doing fine, how does someone else's fortune reach into daily life? The answer is not envy. It is about whether money is still a reward, or whether it has started writing the rules.

As heard by us

Diane Coyle links extreme wealth to political influence, market power, and the future of innovation.

How much inequality can a society absorb before wealth starts to bend public life? The Michael Shermer Show follows that question through Diane Coyle's case that the problem is not inequality alone, but the extreme concentration of wealth and the influence that can come with it.

Read the full review in PlayNext →

Why you'd press play

Want to know when a billionaire's fortune becomes more than private success?

Read the full recommendation in PlayNext →

Listen to the show on

Apple Podcasts Spotify

Play clips from this episode More from The Michael Shermer Show