The conventional measure of economic development is "a complete red herring," Joan Robinson, professor emeritus of economics from Cambridge University, said yesterday before an overflow audience in Emerson 105.

According to neoclassical economics, growth in gross national product (GNP) means an increase in the welfare of a society, but welfare should be considered by a totally different standard from GNP, Robinson said.

She said examining economic growth figures, without considering the content of that growth, sets economists off in the wrong direction.

That consideration is especially important in the economics of developing third-world countries, where growth in GNP resulting from foreign investment may only reflect increased output of luxury goods, while food production may be stagnating, Robinson added.

Air Conditioners

"The amount of welfare and the amount of employment you get from making air conditioners is very small," she said.

Robinson traced the western nations' exploitation of the third world through three historical phases.

First, during the colonial period, natural resources were extracted from the undeveloped countries at relatively low cost, she said.

Later, she explained, the metropolitan countries sought markets for their goods in the developing countries where the previous export of natural resources had created some wealth.

Today, firms from industrialized countries are looking for cheap labor in third world countries, she said.

She said western firms export the products made by the workers and reap the profits of their production without leaving any of the economic gain in the third world.

Robinson, 72 years old, was an important figure in the Keynesian economic revolution of the 1930s.