What is Beyond GDP? And how are Beyond GDP indicators used? Funded by:
May 26, 2015
What is Beyond GDP?And how are Beyond GDP indicators used?
Funded by:
The Project
BRAINPOoL (Bringing alternative indicators into policy) is an EU-funded project aimed at identifying and overcoming the barriers to ‘Beyond GDP’ indicators being used in policy.
During the project we’ve carried out research and interviews, conducting workshops and knowledge-brokerage seminars and carrying out various action research case studies to explore ways to improve uptake of Beyond GDP indicators.
What are indicators for (in general)?
• Instrumental use– Identifying and understanding problems– Analysing policy options– Evaluation
• Conceptual use• Political use
– Legitimisation– Tactical– Symbolic
Outline
• Defining & understanding Beyond GDP• Categorising Beyond GDP initiatives• Impact to date of Beyond GDP
Our definition of Beyond GDP indicators…
“those indicators and indicator sets that have been proposed as necessary and central to the measurement of societal progress in a broad sense, other than those indicators,
such as GDP or the unemployment rate, that are already playing this role.”
BRAINPOoL WP1 report
It is a response to a real and to a measurement problem…
• There is a bias in policy making towards striving for GDP growth that may make resolving critical political problems more difficult, e.g.
– How do we improve lives in an era of low growth and squeezed finance?
– How do we create good jobs for people?
– How do we reduce inequality?
– How do we avoid political extremism?
– How do we deal with climate change and other threats to sustainability?
• This bias is exacerbated by the prominence of the metric itself
– The ability to maximise GDP growth defines ‘economic competence’
– Perceptions of ‘economic competence’ drive elections
– Therefore particularly strong incentives to maximise GDP
…resulting in two interdependent challenges
• Adoption of a new headline measure of progress (or a small set of such measures)
– This can balance GDP and thus indicate a more balanced political programme
• Moves towards a more balanced political programme
– The effective management of trade offs leading to better quality growth (equitable,
sustainable, high well-being)
Prima facie, BRAINPOoL is about the first of these, but they are interdependent: headline measures drive policy but real policy implications make indicators salient.
The real and measurement problem just defined focuses the discussion – as illustrated in the following charts
The bias to GDP maximisation as means to increasing well-being…
Policy Intervention
Growth Well-being
…will not be corrected by parallel objectives, which already exist…
Economic Policy
Growth
Well-being as understood by
economics depts
Other Policy Interventions
Social/ environmental
objectives
Well-being as understood by
other policy depts
…as do the relevant indicators…
Economic Policy
GDP
Other Policy Interventions
Social/ environmental
indicators
…but by a more integrated policy process
Policy Intervention
GDP Well-being –
now and future (sustainability)
‘Beyond GDP’
indicators
…allowing policy makers to target good quality growth…
Policy Intervention
↑ GDP ↑
Well-being – now and future
↑‘Beyond
GDP’ indicators
“Whatever policy objectives you have, you should set them into an integrated policy framework which has as an overarching goal the increase in people’s well-being” , OECD Researcher
…not bad quality growth
Policy Intervention
↑ GDP ↓
Well-being – now and future
↓‘Beyond
GDP’ indicators
…and in some instances to sacrifice growth.
Policy Intervention
↓ GDP
↑‘Beyond
GDP’ indicators
↑Well-being –
now and future
Outline
• Defining & understanding Beyond GDP• Categorising Beyond GDP initiatives• Impact to date of Beyond GDP
Categorising Beyond GDP initiatives
Indicator factors
Economic
EnvironmentalSocial
Objective Subjective
Aggregation
Dashboard
Compound indicator
Single indicator
Aggregated
Composite
Index
Domains
Intended impact
Level of Impact
International
Local
National
Public
ExpertsPoliticians
/ Policy makers
IntendedUsers
Relationship to GDP
Adjust
Replace
Supplement
Intended impact
• Beyond GDP or not?• Policy or debate?• Democratic engagement• Internal or external signalling
Main indicator types
• Adjusted GDP indicators– Objective– Composite– International– All users (but first the
public)– Adjustment– Beyond GDP– Debate– Sometimes signalling
Social Environmental
Economic
Main indicator types
• Quality of life– Objective– Dashboard or index– National– Public and policy-makers– Complement– Usually Beyond GDP– Sometimes policy,
sometimes debate
Economic
Social
Main indicator types
• Subjective approaches– Subjective– Single number– International– All– Replace/complement– Not always Beyond GDP– Policy and debate
Economic
Social
Subjective WB
Environmental
Main indicator types
• Sustainable development / Progress / National Well-Being– Subjective and objective– Dashboard– National– Policy-makers (and public)– Complement (and include)– Not always Beyond GDP– Policy
Social Environmental
Economic
Main indicator types
• Local initiatives– Subjective and objective– Mix of domains– Local– Policy-makers and public– Complement– Not always Beyond GDP– Policy & debate– Democratic engagement Social Environ
mental
Economic
Outline
• Defining & understanding Beyond GDP• Categorising Beyond GDP initiatives• Impact to date of Beyond GDP
The initiatives studied (of ~80)
Domestic Material Consumption
Happy Life Years
OECD Handbook of Subjective Well-Being
UN Commission for Sustainable Development
New indicators have been used to shift debate by outsiders …
• Ecological Footprint, a greater understanding of our global impact
• QUARS in Italy, which was one of the forerunners of the official BES
• HPI in the UK, opened space for ONS initiative
• Subjective well-being, highlighting that there are limits to the benefits of growth
…and are getting some traction in some policy circles…
• Many are being used for assessment purposes– GPI in Maryland by State govt, QUARS in Italy by town and regional govts
– Quality of life indicators for cities in New Zealand by local authorities
– Ecological footprint (e.g. Wales, Ecuador, UAE)
• There have been some associated policy changes– Focus on farmland birds in UK, after Sustainable Development Indicator set
– Delivery of public health projects in USA, after Gallup-Healthways Well-Being Index
– Delivery of projects working with homeless in Belgium, after SPIRAL
– Alcohol policy in UK based on well-being data
• There have even been some clear measurable impacts– Reduction in infant mortality rates, in Jacksonville, Florida
– Reduced recidivism, again resulting from Jacksonville Community Indicators
... but mainly at local or regional level – not in economics depts
• Local successes are easier because – It is easier to bring stakeholders together
– Citizens feel more connected with their locality
– It is easier to bring different parts of local government together
– The focus is spatial planning and local services, not the economy
• Hence some of our examples
– Jacksonville Community Indicators in Florida, SPIRAL, Toronto’s
Vital Signs
• National examples are not ‘Beyond GDP’ impacts– Alcohol, public health, service delivery, farmland birds
So that’s the challenge for today!
Saamah Abdallah, nef (the new economics foundation)
Tomas Hak, Charles University Environment Centre (WP1)
Charles Seaford, nef (the new economics foundation) (WP3)
, James Jordan