Transcript Well-being through a fully aggregated approach

Well-being and multidimensional
deprivation: some results from the
OECD Better Life Initiative
Nicolas Ruiz
Context: Well-being beyond GDP
•President Sarkozy set up the Stiglitz-Sen-Fitoussi Commission
(SSFC) in 2009
•EU Communication on “GDP and beyond” and EU 2020
Agenda (2009 and 2010)
•G20 Leaders statements in 2009, 2010 and 2011
•Conclusions of OECD Ministerial Council (2010)
•Bhutan-UN resolution on new holistic approach to
development with well-being at the core of new economic and
social goals
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Context: Well-being beyond GDP
• Question is not why: well-being beyond income is not a new
concept
• Question is more how: which measures for better policy?
• Demand: governments would like to have a robust
framework for monitoring well-being and shape adequate
policy agenda
• Desiderata: the proposal should be understandable by all,
technically solid, operationally viable and easily replicable
by countries
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The OECD response
•Started almost 10 years ago: one-off reports (i.e.
“Alternative Measures of Well-Being” in Going for Growth
2006), three World Fora on ‘Statistics, Knowledge and
Policies’, OECD-hosted Global Project, Wikiprogress.org
• Involved in work of the Stiglitz-Sen-Fitoussi Commission
•Since 2010: two main streams of work
–analysis/dissemination: making best use of existing
statistics: OECD Better Life Initiative
–methodological/research: setting the foundation
for better metrics in the future (e.g. SWB guidelines,
wealth standards, CO2 footprints, non-market
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production)
The OECD Better Life Initiative
Presents measures,
analysis, and future
statistical agenda on the
dimensions that matters
the most in people’s life
How’s
Life?
(report)
OECD
Better
Life
Initiative
Your Better
Life Index
(interactive
web tool)
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The OECD Better Life Initiative
• OECD countries and some major partner countries
(Russia, Brazil; South Africa, India, Indonesia in
future)
• Analytical perspective:
–
–
–
–
Households and people, rather than economic system
Outcomes, rather than inputs or outputs
Inequalities alongside averages in each dimension
Looking at both objective and subjective aspects of wellbeing
– Sustainability (‘elsewhere and later’) as linked but also
distinct from current well-being (‘here and now’)
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The OECD Better Life Initiative
Core framework
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The OECD Better Life Initiative
Selection criteria
• Relevance of indicators
- face-validity
- easily understood, unambiguous interpretation
- amenable to policy changes
- possibility of disaggregation by population groups
• Quality of supporting data
- official and well-established sources; non-official data used as placeholders in a few cases
- comparable/standardized definitions
- maximum country-coverage
- recurrent data collection
• Significant documentation and testing
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Flagship publication: How is Life?
• Average well-being
achievements in 11
dimensions
• Inequalities in these
achievements across gender,
age and socio-economic status
• Changes of well-being over
time when the information is
available
• Drivers of well-being
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Employment rate
Long-term
unemployment rate
Average annual
earnings per employee
Numer of rooms per
person
Dwelling without basic
facilities
Life-expectancy at birth
Self-reported health
status
Employees working very
long hours
Time devoted to leisure
and personal care
Employment rate of
women with children of
compulsory school age
Educational attainment
Students' cognitive
skills
Social network support
Voter turn-out
Consultation on rulemaking
Air quality
Intentional homicides
Self-reported
victimisation
Life-satisfaction
Affect balance
2009
Australia
Austria
Belgium
Canada
Chile
Czech Republic
Denmark
Estonia
Finland
France
Germany
Greece
Hungary
Iceland
Ireland
Israel
Italy
Japan
Korea
Luxembourg
Mexico
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
Slovenia
Spain
Sweden
Switzerland
Turkey
United Kingdom
United States
Household financial net
wealth per person
Household net adjusted
disposable income per
person
Well-being through a fully disaggregated approach
2009
2010
2010
2009
2009
2009
2009
2009
2009
2000
2008
2009
2009
2010
2007
2008
2008
2008
2010
2010
2010
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Well-being through a fully disaggregated approach
No strict well-being dominance
60%
Number of red lights out of 22 headline indicators
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Well-being through a fully aggregated approach
Your Better Life Index
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Well-being through a fully aggregated approach
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•
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Multidimensional index of well-being
Aggregation over 11 topics
Inequality neutral
Interactive tool where weights have to be set by
the user
• New release yesterday
• Gender-inequality sensitive index
• Try it at the coffee break:
http://oecdbetterlifeindex.org/
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Well-being through a fully aggregated approach
• Looking at deprivations which batter individuals at
the same time
• Gallup-based evidence
• Following Alkire and Foster multidimensional
counting method (JPE, 2011):
– Identification : selecting of dimensions and subdimensions (i.e. elementary indicators)
– Setting the dimensional cut-offs
– Setting the aggregation cut-off
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Netherlands
Denmark
United Kingdom
Canada
Sweden
Australia
Luxembourg
Germany
Austria
New Zealand
Ireland
United States
Slovenia
Belgium
South Korea
France
Japan
Finland
Czech Republic
Poland
Spain
Chile
Slovakia
Hungary
Italy
Brazil
Turkey
Indonesia
Greece
India
Well-being through a fully aggregated approach
100%
90%
80%
70%
Dep in 9 dim
60%
Dep in 8 dim
Dep in 7 dim
50%
Dep in 6 dim
40%
Dep in 5 dim
Dep in 4 dim
30%
Dep in 3 dim
20%
Dep in 2 dim
Dep in 1 dim
10%
Deprived in 0 dimensions
0%
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Well-being through a fully aggregated approach
Cumulative proportion of deprived, group of high well-being countries
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0.9
0.8
Australia
0.7
Austria
Canada
Germany
0.6
Ireland
Luxembourg
0.5
Netherlands
New Zealand
0.4
Sweden
United Kingdom
United States
0.3
Denmark
0.2
0.1
0
1
2
3
4
5
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Number of dimensions in which people are deprived
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8
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Well-being through a fully aggregated approach
Subjective well-being and health in high well-being countries
Luxembourg
Denmark
Sweden
Australia
Netherlands
Housing
United Kingdom
Austria
Job
Ireland
Income
Germany
Canada
Social Connections
New Zealand
Japan
Security
Finland
Civic engagement and
governance
Subjective well-being
France
Belgium
South Korea
United States
Health
Slovenia
Education
Czech Republic
Poland
Environment
Spain
Indonesia
Slovakia
Italy
Chile
Brazil
Hungary
Turkey
Greece
India
0%
10%
20%
30%
40%
50%
60%
Housing and social connections in
low well-being countries
70%
80%
90%
100%
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Well-being through a intermediate approach
(work in progress)
How to reconcile the appeal of a complete ordering,
scalar approach with the assumption-free dashboard
presentation?
Simple Venn diagrams
Multivariate stochastic dominance
Direct representation of dependency in addition to
margins (i.e. central tendency in each dimension+
intersection information)
Is an intermediate posture really feasible?
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Well-being through a different approach (work in
progress)
• Equivalent income computation
• Literally beyond GDP: coupling GDP and
compensating variations in a way consistent with
social choice theory
• All differences in non-income well-being
dimensions are converted to income differences
• A different ranking of countries emerge
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Thank you!
[email protected]
oecdbetterlifeinitiative.org
oecdbetterlifeindex.org
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