Embed Size (px)
Citation preview
Beyond GDP: Trends and Economic Well-Beingin Newfoundland and Labrador, 1981 - 2017
Andrew Sharpe
Memorial University
Friday, September 6th, 2019
• I) The Measurement of Economic Well-Being: A Debate
• II) An Overview of the IEWB
• III) The Consumption Flows Domain
• IV) The Stocks of Wealth Domain
• V) The Equality Domain
• VI) The Security Domain
2
GDP
Economic Well-
being
GDP
Human Well-Being > Economic Well-Being > GDP
GDP
Economic Well-
being
GDP
“Social regrettables”
Well-Being > Economic Well-Being > GDP- regrets
Dimensions of Economic Well Being
Concept Present
“Typical Citizen” Average Flow of Current Income
Per Capita GDP or “Adjusted” Average Income Flow
Issues: Market transactions only? leisure & household production?
Dimensions of Economic Well-Being
Dimensions of Economic Well Being
Concept Present
“Typical Citizen” Average Flow of Current Income
Diversity of Population
Distribution of Current Income
- Poverty and Inequality
Diminishing MUy
Less well-being if same total income is more unequally distributed
Dimensions of Economic Well Being
Concept Present Future
“Typical Citizen”
Average Flow of Effective Current Consumption
Aggregate Accumulation of Productive Stocks (broadly defined)
Issues: Average Income does not reveal savings rate
- assets include environment, Human Capital, R&D, net foreign.
Aggregate Savings
– not automatically optimal or sustainable
–preferences for sustainability differ among individuals
Dimensions of Economic Well Being
Concept Present Future
“Typical Citizen” Average Flow of Effective Current Consumption
Aggregate Accumulation of Productive Stocks
Diversity of Population
Distribution of Current Income:
- Poverty and Inequality
Insecurity of Future Income
Schematic of the Index of Economic Well-Being
• INDEX OF ECONOMIC WELL-BEING (IEWB) = α1 PER CAPITA CONSUMPTION + α2 SUSTAINABILITY / ACCUMULATION+ α3 INCOME DISTRIBUTION / POVERTY+ α4 SECURITY
• ∑α = 1
– DIFFERING VALUES IMPLY DIFFERENT WEIGHTS• α = 0 is a (strong) value choice • GDP per capita sets α3 = α4 = 0 and assumes α2 is
optimal9
Index of Economic Well-Being[ Osberg / Sharpe ]
Current Debates mingle Facts & Values
• ECONOMIC WELL-BEING =α1 [ CONSUMPTION ]
+ α2 [ TOTAL WEALTH ]+ α3 [ DISTRIBUTION ]+ α4 [ SECURITY ]
• DIFFERENT VALUES IMPLY DIFFERENT WEIGHTS, BUT DOES TREND CHANGE?– how much does aggregate trend actually depend on value
weightings or on perceptions of fact trends?
– WHERE is the disagreement if assessment trends differs?
Schematic of the Index of Economic Well-Being
• Normalized to Unit Interval - Linear Scaling • (1.05*Max – value)/(Max – Min)*1.1
Scaling Procedure
Schematic of the Index of Economic Well-Being
12
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
0.800
0.900
1.000
Consumption percapita
Stocks of Wealth percapita
Index of EconomicEquality
Index of EconomicSecurity
Index of EconomicWellbeing (Equal
Weighting)
1981
2000
2008
2014
2017
The Index of Economic Well-Being for Newfoundland and Its Domains in 1981, 2000, 2008, 2014, and 2017, 2007 Dollars
13
Source: IEWB Database, Calculations by Author
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Index of Consumption Flows per Capita
Index of Stocks of Wealth per Capita
Index of Economic Equality
Index of Economic Security
Overall Index of Economic Well-Being
Trends in the Index of Economic Well-Being for Newfoundland and Its Domains, 1981 - 2017
14
Source: IEWB Database, Calculations by Author
GDP per Capita in Newfoundland vs. in Canada, 1981 – 2017, 2007 Dollars
15
Source: IEWB Database, Calculations by Author
0
10000
20000
30000
40000
50000
60000
70000
80000
1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
GDP per Capita, Newfoundland
GDP per Capita, Canada
1.230.87
1.63
5.58
-1.76-1.31
-2.64
2.442.66
2.20
5.39
-0.55-1.05
0.46
-4.00
-3.00
-2.00
-1.00
0.00
1.00
2.00
3.00
4.00
5.00
6.00
1981-2017 1981-2000 2000-2017 2000-2008 2008-2017 2008-2014 2014-2017
Index of Economic Well-Being
GDP per Capita
Compound Annual Growth Rates of the Index of Economic Well-Being for Newfoundland and Newfoundland GDP per
Capita, 1981-2017
16
Source: IEWB Database, Calculations by Author
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
Index of Economic Well-Being for Canada
Index of Economic Well-being for Newfoundland
The Index of Economic Well-Being for Newfoundland vs. for Canada, 1981 - 2017
17
Source: IEWB Database, Calculations by Author
0.00
20.00
40.00
60.00
80.00
100.00
120.00
Proportion of National
The Index of Economic Well-Being for Newfoundland as a Proportion of the National Index, 1981 - 2017
18
0.490.75
0.200.69
-0.22 -0.15-0.38
1.230.87
1.63
5.58
-1.76-1.31
-2.64
-4.00
-3.00
-2.00
-1.00
0.00
1.00
2.00
3.00
4.00
5.00
6.00
1981-2017 1981-2000 2000-2017 2000-2008 2008-2017 2008-2014 2014-2017
Index of Economic Well-Being forCanada
Index of Economic Well-Being forNewfoundland
Compound Annual Growth Rates of the Index of Economic Well-Being for Canada and Newfoundland, 1981 - 2017
19
Source: IEWB Database, Calculations by Author
Ranking by Index of Economic Well-Being and GDP per Capita of Canada and the Provinces
20
Level in 2017 Growth Rate, 1981 - 2017
RankIndex of Economic
Well –BeingGDP per Capita
Index of Economic
Well –BeingGDP per Capita
1 British Columbia Alberta Quebec Newfoundland
2 Alberta Saskatchewan Newfoundland Prince Edward Island
3 Ontario Newfoundland New Brunswick New Brunswick
4 Quebec Canada British Columbia Saskatchewan
5 Canada Ontario Ontario Nova Scotia
6 Manitoba British Columbia Manitoba Manitoba
7Newfoundland &
LabradorManitoba Nova Scotia Canada
8 New Brunswick Quebec Prince Edward Island Ontario
9 Nova Scotia New Brunswick Canada Quebec
10 Prince Edward Island Nova Scotia Alberta Alberta
11 Saskatchewan Prince Edward Island Saskatchewan British Columbia
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
PersonalConsumption per
capita
GovernmentExpenditure per
capita
Unpaid Work percapita
RegrettableExpenditures per
capita
Total Consumptionper capita
1981
2000
2008
2014
2017
The Consumption Domain for Newfoundland and Its Components in 1981, 2000, 2008, 2014, and 2017, 2007
Dollars
21
0
10000
20000
30000
40000
50000
60000
Adjusted Total Consumption perCapita, Newfoundland
Adjusted Total Consumption perCapita, Canada
Actual Total Consumption per Capita in Newfoundland vs. in Canada, 1981 – 2017, 2007 Dollars
22
Source: IEWB Database, Calculations by Author
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
Scaled Total Consumption perCapita, Newfoundland
Scaled Total Consumption perCapita, Canada
Scaled Total Consumption per Capita in Newfoundland and in Canada, 1981 – 2017
23
Source: IEWB Database, Calculations by Author
0.00
5,000.00
10,000.00
15,000.00
20,000.00
25,000.00
30,000.00
35,000.001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Personal Consumption perCapita, (Newfoundland)
Personal Consumption perCapita (Canada)
Personal Consumption per Capita in Newfoundland and in Canada, 1981 – 2017, 2007 Dollars
24
Source: IEWB Database, Calculations by Author
0
0.5
1
1.5
2
2.5
3
3.5
4
Average Family Size inNewfoundland
Average Family Size inCanada
Average Economic Family Size in Newfoundland and in Canada, 1981 - 2017
25
Source: IEWB Database, Calculations by Author
-2,000.00
0.00
2,000.00
4,000.00
6,000.00
8,000.00
10,000.00
12,000.00
14,000.00
16,000.001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Total Government Expenditure perCapita
Current Government Expenditureper Capita
Capital Consumption Allowance perCapita
Gross Fixed Capital Formation perCapita
Inventory Investment per Capita
Government Expenditure per Capita and Its Sub-Components in Newfoundland, 1981 – 2017, 2007 Dollars
26
Source: IEWB Database, Calculations by Author
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
Value of Unpaid Work perWorking-Age Person(Newfoundland)
Value of Unpaid Work perWorking-Age Person (Canada)
Value of Unpaid Work in Canada vs. in Newfoundland, 1981 –2017, 2007 Dollars
27
Source: IEWB Database, Calculations by Author
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
Regrettable Expenditures inNewfoundland
Regrettable Expenditures in Canada
Regrettable Expenditures per Capita in Newfoundland vs. in Canada, 1981 – 2017, 2007 Dollars
28
Source: IEWB Database, Calculations by Author
70
72
74
76
78
80
82
84
Life Expectancy at Birth(Newfoundland)
Life Expectancy at Birth (Canada)
Life Expectancy at Birth in Canada and in Newfoundland, 1981 - 2017
29
Source: IEWB Database, Calculations by Author
Levels of Components of the Stocks of Wealth Domain in Newfoundland in 1981, 2000, 2008, 2014, and 2017, 2007
Dollars
30
Source: IEWB Database, Calculations by Author
-200,000.00
-100,000.00
0.00
100,000.00
200,000.00
300,000.00
400,000.00
500,000.00
Per capita NetCapital Stock
R&D Stock percapita
NaturalResources Stock
per capita
Human CapitalStock per capita
Social Cost ofGreenhouse Gas
Emissions percapita
Total Stocks ofWealth per capita
1981
2000
2008
2014
2017
Actual Total Stocks of Wealth per Capita in Newfoundland vs. in Canada, 1981 – 2017, 2007 Dollars
31
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,0001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Total Stocks of Wealth per Capitain Canada (Actual)
Total Stocks of Wealth per Capitain Newfoundland (Actual)
Source: IEWB Database, Calculations by Author
Scaled Total Stocks of Wealth per Capita in Newfoundland vs. in Canada, 1981 - 2017
32
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
0.800
0.900
1.000
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Total Stocks of Wealth per Capita inCanada (Scaled)
Total Stocks of Wealth per Capita inNewfoundland (Scaled)
Source: IEWB Database, Calculations by Author
Net Capital Stock per Capita and Its Sub-Components in Newfoundland, 1981 – 2017, 2007 Dollars
33
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,0001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Total Net Capital Stock per Capita
Fixed Non-Residential Capital perCapita
Residential Capital per Capita
Source: IEWB Database, Calculations by Author
R&D Stock per Capita in Newfoundland and in Canada, 1981 – 2017, 2007 Dollars
34
0
500
1000
1500
2000
2500
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
R&D Stock per Capita(Newfoundland)
R&D Stock per Capita(Canada)
Source: IEWB Database, Calculations by Author
Resources Stock per Capita and Its Sub-Components in Newfoundland, 1981 – 2017, 2007 Dollars
35
0.00
50,000.00
100,000.00
150,000.00
200,000.00
250,000.001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Timber Stocks per Capita
Energy Stocks per Capita
Mineral Stocks per Capita
Total Natural Resources Stockper Capita
Source: IEWB Database, Calculations by Author
Human Capital Stock per Capita in Newfoundland and in Canada, 1981 – 2017, 2007 Dollars
36
0.00
20,000.00
40,000.00
60,000.00
80,000.00
100,000.00
120,000.00
140,000.00
160,000.00
180,000.001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Human Capital Stock per Capita(Newfoundland)
Human Capital Stock per Capita(Canada)
Source: IEWB Database, Calculations by Author
Social Cost of Greenhouse Gas Emissions per Capita in Newfoundland Compared to In Canada, 1981 – 2017, 2007
Dollars
37
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,0001
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Social Cost per Capita in Canada
Social Cost per Capita inNewfoundland
Source: IEWB Database, Calculations by Author
Compound Annual Growth Rates of the Index of Economic Well-Being for Newfoundland Under Various Weighting
Schemes and Costs For Carbon, 1981 – 2017
38
Source: IEWB Database, Calculations by Author
IEWB
Equal
Weighting
=.25C+.25W+.
25E+.25S
Consumptionist
Weighting
=.7C+.1W+.1E+.1
S
Consumption
Weighted More
Heavily Than
Wealth
=.4C+.1W+.25E+.
25S
Anti-Egalitarian
Weighting=.33C+.
33W+.0E+.33S
Equality and Security
Weighting
=.2C+.1W+.4E+.3S
$51.25 in 2016 1.40 3.30 1.69 1.57 0.99
$125 in 2016
(Baseline)1.23 3.21 1.62 1.34 0.93
$250 in 2016 0.35 2.89 1.30 0.08 0.60
Compound Annual Growth Rates of the Index of Economic Well-Being for Newfoundland Under Various Weighting
Schemes and Costs For Carbon, 1981- 2000
39
Source: IEWB Database, Calculations by Author
IEWB
Equal Weighting
=.25C+.25W+.25
E+.25S
Consumptionist
Weighting
=.7C+.1W+.1E+.1S
Consumption
Weighted More
Heavily Than
Wealth
=.4C+.1W+.25E+.25S
Anti-Egalitarian
Weighting=.33C+.33
W+.0E+.33S
Equality and Security
Weighting
=.2C+.1W+.4E+.3S
$51.25 in 2016 1.06 4.30 1.43 1.75 0.12
$125 in 2016
(Baseline)0.87 4.18 1.35 1.50 0.05
$250 in 2016 -0.13 3.74 0.95 0.19 -0.35
Compound Annual Growth Rates of the Index of Economic Well-Being for Newfoundland Under Various Weighting
Schemes and Costs For Carbon, 2000 - 2008
40
Source: IEWB Database, Calculations by Author
IEWB
Equal Weighting
=.25C+.25W+.25
E+.25S
Consumptionist
Weighting
=.7C+.1W+.1E+.1S
Consumption
Weighted More
Heavily Than
Wealth
=.4C+.1W+.25E+.25S
Anti-Egalitarian
Weighting=.33C+.33
W+.0E+.33S
Equality and Security
Weighting
=.2C+.1W+.4E+.3S
$51.25 in 2016 5.52 4.91 4.70 5.45 4.75
$125 in 2016
(Baseline)5.58 4.94 4.73 5.53 4.77
$250 in 2016 5.80 4.97 4.75 5.80 4.80
Compound Annual Growth Rates of the Index of Economic Well-Being for Newfoundland Under Various Weighting
Schemes and Costs For Carbon, 2008 - 2017
41
Source: IEWB Database, Calculations by Author
IEWB
Equal Weighting
=.25C+.25W+.25E
+.25S
Consumptionist
Weighting
=.7C+.1W+.1E+.1S
Consumption
Weighted More
Heavily Than Wealth
=.4C+.1W+.25E+.25S
Anti-Egalitarian
Weighting=.33C+.33
W+.0E+.33S
Equality and Security
Weighting
=.2C+.1W+.4E+.3S
$51.25 in 2016 1.43 2.93 1.74 1.87 0.92
$125 in 2016
(Baseline)1.39 2.92 1.73 1.83 0.90
$250 in 2016 1.21 2.87 1.66 1.61 0.83
The Index of Economic Equality and Its Components in Newfoundland in 1981, 2000, 2008, 2014, and 2017
42
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
Index of the GINI Coefficient Index of Poverty Intensity Index of Economic Equality
1981
2000
2008
2014
2017
Source: IEWB Database, Calculations by Author
Trends in the Index of Economic Equality and Its Components in Newfoundland, 1981 - 2017
43
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.81
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of the GINI Coefficient
Index of Poverty Intensity
Overall Index of EconomicEquality
Source: IEWB Database, Calculations by Author
The Index of the GINI Coefficient in Newfoundland vs. in Canada, 1981 - 2017
44
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Actual Value of the GINICoefficient for Newfoundland
Scaled Value of the GINICoefficient for Newfoundland
Actual Value of the GINICoefficient for Canada
Scaled Value of the GINICoefficient for Canada
Source: IEWB Database, Calculations by Author
The Index of Poverty Intensity in Newfoundland and in Canada, 1981 - 2017
45
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of Poverty Intensityfor Newfoundland
Index of Poverty Intensityfor Canada
Source: IEWB Database, Calculations by Author
The Index of Security and Its Components in Newfoundland in 1981, 2000, 2008, 2014, and 2017
46
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
0.800
0.900
Risk(Unemployment)
Risk (Illness) Risk (Single-ParentPoverty)
Risk (Old-AgePoverty)
Index of EconomicSecurity
1981
2000
2008
2014
2017
Source: IEWB Database, Calculations by Author
The Index of Economic Security in Newfoundland Compared to the Index of Economic Security in Canada, 1981 - 2017
47
0.000
0.100
0.200
0.300
0.400
0.500
0.600
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of Economic Security inCanada
Index of Economic Security inNewfoundland
Source: IEWB Database, Calculations by Author
The Index of Economic Security and Its Components in Newfoundland, 1981 - 2017
48
0.000
0.100
0.200
0.300
0.400
0.500
0.600
0.700
0.800
0.900
1.000
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of Security FromUnemployment
Index of Security From Illness
Index of Security From Single-Parent Poverty
Index of Security From Old-Age Poverty
Overall Index of EconomicSecurity
Source: IEWB Database, Calculations by Author
The Index of Security From Unemployment in Canada and in Newfoundland, 1981 - 2017
49
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of Security FromUnemployment inNewfoundland
Index of Security FromUnemployment in Canada
Source: IEWB Database, Calculations by Author
The Index of Security From Illness in Canada vs. in Newfoundland, 1981 - 2017
50
Source: IEWB Database, Calculations by Author
0
0.1
0.2
0.3
0.4
0.5
0.6
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of Security From Illness inNewfoundland
The Index of Security From Single-Parent Poverty in Canada and in Newfoundland, 1981 - 2017
51
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
Index of Security From Single-ParentPoverty in Newfoundland
Index of Security From Single-ParentPoverty in Canada
Source: IEWB Database, Calculations by Author
The Index of Security From Old-Age Poverty in Canada Compared to in Newfoundland, 1981 - 2017
52
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
11
98
1
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
20
15
20
17
Index of Security From Old-AgePoverty in Newfoundland
Index of Security From Old-AgePoverty in Canada
Source: IEWB Database, Calculations by Author
