Please visit the website at

https://www.bu.edu/pardee/files/documents/PP-004-GDP.pdf

An Inventory of Composite Measures of Human Progress, available at http://hdr.undp.org/en/content/inventory-composite-measures-human-progress, details 101 composite measures of human well-being and progress. Themes range from happiness-adjusted income to environmentally-adjusted income, from child development to information and communications technology development.

So, the world is not short of measurement systems; what is missing—here, there, but not necessarily everywhere—is the political will to act on indicators as the occasion demands. (Obviously, what with conflicting interests, not everybody will be equally pleased.) In this respect, nonetheless, the Sustainable Development Goals that the United Nations approved in September 2015 are encouraging.

(Understand: The Sustainable Development Goals, a small project available at https://www.researchgate.net/project/Understand-The-Sustainable-Development-Goals, shares 15 ready references on the topic.)

Everybody is suggesting to Cihan some alternative measures to GDP, but I understand that this was not his question. He is asking about how to introduce such alternative measure in a growth model. The problem is that, while there are a number of theories that link GDP growth to other economic variables (investment, capital, technology, demand, trade, ...), there have been not yet developed theories that link non-monetary indicators of well-being to traditional economic variables. Until we do not have such theories, it would be very difficult to create a growth model with well-being or socioeconomic indicators.

Even if GDP is not a perfect measure of well-being,  development and other aspects beyond economic growth. Other approaches to the welfare of an economy such as the Human Development Index (HDI), Index of Wellbeing mentioned can be used to support the old model as we look forward to new innovations

Thank you all for your contributions. However, it seems that only Dr. De Muro understood my question. I have already built my own development index for Turkey and tried to link it to some variables (such as human capital investments). A growth model looks like a good start at first glance, but it doesn't feel right when you go deeper. 

I believe along with Dr. De Muro, my understanding of the question is the following: Do socioeconomic development indexes correlate well with growth and development; e.g., various World Bank Indexes (available from WB website)? Broad answer is yes. Countries that rate high on such indexes are developed countries usually. Such countries have relatively lower growth rates but rates are far more stable. Socioeconomic indexes capture a lot of aspects of economic development. A study correlating such rankings with stability (e.g., of growth) would be interesting. 

Dear S. Nuri Erbas, I agree with you: there is a certain correlation between, on one side, social and human development and, on the other side, economic growth. However, when you want to build a model of these relations, you should assume a certain causality, that is not just correlation. Causality is a much stronger assumption.

Even if they are correlated, this doesn't mean that you can use the same theoretical models to explain socio-economic development. We shouldn't miss this point, either. When you use and solve a Cobb-Douglas type production function, you make a lot of assumptions and the function is based on the inputs and outputs of firms. 

Socioeconomic index should include income, age  and probably marital status. if  this  is what you want then there is  possibility of multi-col-linearity.  Economic growth model is already a per capita income  model. if this index can be constructed it is an addition  of new knowledge in development economics.

I would suggest a Human Capital Index (that incorporates technical and vocational education and training among other elements) as superior to GDP as a broad socio-economic development and welfare index. GDP per capita, of course, still has value as a socio-economic and welfare index.  

They key constraint of alternative measures is the availability of data which is why GDP for all its ills remains relevant. While itself still problematic in terms of availability it is significantly more easily available and calculate-able than alternative measures. One consideration could be the inequality levels and then the gini coefficient and other inequality measures such as the atkinson index. I believe the answer lies in being clear what is of importance and considering what is of importance. The human development index would also be a natural reference point as you correctly point to.

@Pieter is at the crux of the matter.  We first have to decide what is important and to then consider that. The first problem is the very concept of growth.  Growth of what? Without a sensible consensus on that answer we will continue to run around in circles chasing our tails. Even here in these few answers it is implicit in most uses of the word that growth is still the measurement of the gross increase in generated monetary profit. But at the same time asserting that there is no strong evidence that this measure has much to do with the actual objectives of life in terms of happiness and wellbeing.  The brainwashing of the past century is so insidious its false precepts continue to go unrecognised and unchallenged by ourselves even as we talk here about the alternatives.  Man's development has been the story of tools to amplify the ability of our weak bodies in the provision of the requirements for wellbeing and happiness.  The more perceptive amongst you will quickly see the implication.  Forget, for the time being, indices that will always be tautological in their conception so long as they operate in a socio-economic landscape in which our 'tools' remain the object of private accumulation, ownership and perpetual rental to the 99% who must still use them every day to give them any value. GDP is only measuring that rental payment and our institutions are the mechanisms that seek to maximise that rental while mainting a minimum degree of compliance amongst those that are minimally rewarded for working with those tools and the acquiescence of those that are surplus to that requirement.   The process is blatantly clear in the RSA.  Not so, Pieter?     Growth is a completely inappropriate term in the pursuit of human development so long as it implies growth in profit in the absence of direct linkage to 'tool' development where what is classed as a tool is constrained by its mode of use or contribution of utility in directly and transparently increasing societal wide wellbeing and happiness of each and every individual.  This is not the place to expand on the many other issues which that statement raises.  Reconstruction of our paradigm for the better is what we all claim to be concerned with. All I will do here is remind each of us what are the goals and through the fog of the past that is clouding our present vision where those goal posts may lie.

AGREE WITH ALL THAT HAS BEEN MENTIONED EARLIER. We must come up with different measurement for different country. Advance and much develop country for example like USA, European, Japan have one standard GDP measurement which is different for other developing countries. Economic variables or  elements mentioned earlier can be applied to all countries.

Yes, it is possible to create a socio-economic development index to replace GDP in a growth model. GDP is not a perfect measure of well-being, and development has other aspects beyond economic.