It is with considering what the GDP would be if you eliminated most rent-seeking businesses and there was a much broader spread of technical know-how across society (gardening, electrical repairs, plumbing, workshop experience, cooking and other home skills).

If we wasted less and took better care of the environment around us, the costs to society would be less, this could be measured as a decrease in spending and a shrinkage of the GDP. You wouldn’t buy new clothes as often if you could maintain your existing wardrobe, and you wouldn’t buy electronics or appliances as often if you could extend the lifespan of your current electronics. Basically there wouldn’t be as big a drive for consumerist spending patterns and this could be measured, by a decrease in the GDP which would of course cause financial markets to panic.

My thoughts on this are far from complete, but that said, I don’t think our market system is really all that efficient from a tangible resource allocation perspective. It might be highly effective from the perspective of the financial and insurance industries, but the assets they hold are intangible, and the market is probably over-optimized for allocation of intangible resources simply because there is more money to be made there. That is still an optimized market for the allocation of resources with the highest rate of return, but maybe it is time to ask ourselves if that is still to our benefit?