Endorsement
Christophe Parisot is a graduate from HEC Paris and holds a postgraduate degree (DESS) from the Institute of Iberian and Latin American Studies at Sorbonne University. A specialist in public sector analysis and sovereign risk, he served as Managing Director, Head of EMEA Public Finance at Fitch Ratings, after holding similar positions at Standard & Poor’s covering France and the Iberian Peninsula. Drawing on extensive experience in credit risk and country risk analysis within the banking sector (Dexia, Natixis), he has led an independent consulting firm since 2022 focused on solvency and extra-financial risks affecting bond issuers. He also teaches risk analysis and sustainable finance at several business schools in France.
I have long learned, through sovereign risk analysis, to be cautious of overly simple categories. They offer reassurance, but rarely explanation. Describing a country as “developed” or “developing” often freezes a moving reality, whereas the robustness of a development model is ultimately revealed over time, under constraints, and in the face of both domestic and external shocks.
This is why I find SKEMA Publika’s report Measuring Development in the 21st Century, written by a multidisciplinary team led by Amaury Goguel, particularly valuable and original. The report does more than challenge the limits of GDP, per capita income, or international classifications. It proposes another way of understanding development: not as a status, but as a capacity for resilience. In my view, this is one of its most valuable contributions. A developed economy is not simply a wealthy economy; it is an economy capable of financing its strategic choices, preserving macroeconomic and financial stability, maintaining market access, investing in its productive base, ensuring a balanced distribution of the gains from growth, and absorbing shocks without systemic disruption.
The methodological, multifactorial, and comparative approach adopted by the report sheds light on the structural differences between the United States, France, and China. It shows that the former benefits from exceptional financial centrality; the second illustrates stabilising institutional and social maturity; while the third combines industrial power, state-directed capital allocation, and an ongoing process of financial maturation. One of the study’s distinctive strengths lies in recognising that no development trajectory is universally optimal and that all models rely on trade-offs.
In this respect, the report offers an innovative perspective and contrasts with predominantly quantitative approaches to country risk analysis: it places greater emphasis on long-term dynamics and reintroduces internal coherence and vulnerability into the assessment of development. For policymakers, investors, analysts, and students alike, this framework offers far more than a classification system. It provides a method for understanding how nations sustain themselves, adapt, and at times transform in an uncertain world.
How can a country’s economic development be measured? For decades, gross domestic product (GDP) has been the most widely used indicator for assessing an economy’s performance. However, as economic, social, environmental and technological changes intensify, this indicator is proving increasingly inadequate for capturing the reality of development. Therefore, rethinking the approach to measuring economic development has become a key priority for both economists and policymakers.
The first volume of the report Measuring Development in the 21st Century, published by SKEMA Publika, examines new economic indicators to assess countries’ development trajectories and examines the limitations of traditional analytical tools. In this report, we apply our methodology to France, China and the United States.
Economic Growth and Development: A Key Distinction
Economic growth and economic development are often used interchangeably, even though they refer to different concepts. Economic growth refers to the increase in the production of goods and services within an economy, generally measured by changes in GDP. It reflects changes in a country’s economic activity and allows for comparisons of economic performance over time.
Economic development, on the other hand, refers to a broader process of social transformation. It is a source of improved living standards, poverty reduction, greater access to education and healthcare, and the transformation of productive structures. It cannot, therefore, be reduced to mere growth in output.
This distinction lies at the heart of current debates on how to measure economic progress, a point we emphasise in our indicator.
GDP : An Essential Yet Incomplete Indicator
GDP remains the benchmark indicator for analysing economic activity. It measures the total value of goods and services produced in a country over a given period.
This indicator has several advantages. It allows for monitoring economic trends, calculating growth rates and comparing the size of economies across countries. GDP per capita is also a commonly used indicator for estimating the average standard of living of a population.
However, GDP has well-known limitations. It provides no information on income distribution, does not directly measure poverty or inequality, and fails to account for certain economic activities, such as domestic work or certain forms of the informal economy.
Towards a Multi-Factor Approach to Economic Development
To address these limitations, economists have developed other indicators to better measure development. The human development index (HDI), developed by the United Nations Development Programme (UNDP), for example, combines indicators of income, education and life expectancy to assess human progress.
Going beyond the limitations of isolated indicators, the report draws on a range of complementary economic indicators to shed light on the various aspects of economic development. These variables include, in particular, productivity and production efficiency, the use of inputs, the structure of production and integration into international trade, as well as the financial and trade balances that determine the stability of economies.
The analysis also incorporates statistical adjustments that are essential for comparing countries, such as price changes, inflation and purchasing power parity.
What makes the report unique is the way it integrates these various indicators within a multi-factor approach, which does not merely focus on a measure of wealth but seeks to analyse the economic structures and dynamics of transformation specific to each country.
This method thus makes it possible to compare economic trajectories and move beyond traditional categories, such as the distinction between developed and developing countries, which has become increasingly irrelevant when it comes to capturing the diversity of contemporary situations. Indeed, this practice of classifying countries into two categories strikes us as outdated at a time when the world is moving towards multipolarity.
Three Contrasting Economic Trajectories
To illustrate this approach, the report compares the economic trajectories of three major economies: China, the United States and France. All three countries presenting very different economic structures.
The United States stand out as a particularly innovative and productive economy, capable of maintaining a dominant position in many strategic sectors. France represents a developed and stable economy, characterised by a high level of human capital and a diversified productive base. China, for its part, exemplifies the trajectory of a rapidly transforming economy, marked by sustained industrialisation and a gradual rise within global value chains.
Our analysis shows that comparable levels of production can correspond to very different development trajectories.
A New Perspective on Development
By combining various economic indicators and analysing countries’ productive structures, this approach provides a better understanding of the dynamics of development in the contemporary global economy. The different development trajectories do not reflect inherent differences, but rather distinct structural trade-offs that illustrate the hybrid nature of the concept of “developing country”.
It also provides a framework for analysing and interpreting current economic transformations and shifts in the global economic balance. This analysis will be complemented by a subsequent volumes focusing on the human, institutional, technological and environmental dimensions of development.
