Overview of the System of Community Accounts

(Up To and Beyond Stiglitz)

Doug May*Alton Hollett**Robert Reid**

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*Memorial University** Government of Newfoundland and Labrador

System of Community Accounts

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Well-Being Accounts

Production Accounts

Well-Being Accounts in SCA

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Well-Being

Consumption/Income Relationships

Environment

Health

CommunityWork

Education Society Time

Demographics

Production Accounts in SCA

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Gross Outputs

LabourCapital

Land M&E Bldgs

MaterialsServicesInfrastructureResources

Eco-system

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Production Economy

Income, Consumption,

Leisure

Social Relationships

Health

Community Safety & Social

Vitality

Society Culture, Politics and

Justice

Employment

Capital Stock

Knowledge R&D

Engineering Infrastructure

Services

Materials

Plant & Buildings

Machinery

Natural Resources

Eco-System

Education

Demographics

Human Capital

From The

Well-Being

To

Environment

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Domain Dimensions: Groups, Time, Space

Stiglitz Commission’s Recommendations 1. When evaluating material well-being, look at consumption and

income rather than production. 2. Emphasize the household perspective. 3. Consider income and consumption jointly with wealth. 4. Give more prominence to the distribution of income, consumption

and wealth.• 5. Broaden income to non-market activities. 6. Quality of life depends on people’s objective conditions and

capabilities. Steps should be taken to improve measures of people’s health, education, personal activities and environmental conditions. In particular, substantial effort should be devoted to developing and implementing robust, reliable measures of social connections, political voice, and insecurity that can be used to predict life satisfaction.

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Recommendations Continued• 7. Quality-of-life indicators in all dimensions covered should address

inequalities in a comprehensive way. 8. Surveys should be designed to address the links between various

quality-of-life domains for each person , and this information should be used when designing policies in the various fields.

9. Statistical offices should provide the information needed to aggregate across quality-of-life dimensions, allowing the construction of different indexes.

10. Measures of both objective and subjective well-being provide key information about people’s quality of life. Statistical offices should incorporate questions to capture people’s life evaluations, hedonic experiences and priorities in their own surveys.

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Recommendations Continued 11. Sustainability assessment requires a well-defined

dashboard of indicators. The distinctive feature of the components of this dashboard should be that they are interpretable as variations of some underlying “stocks”. A monetary index of sustainability has its place in such a dashboard but, under the current state of the art, it should remain essentially focused in economic aspects of sustainability.

12. The environmental aspects of sustainability deserve a separate follow-up based on a well-chosen set of physical indicators. In particular there is a need for a clear indicator of our proximity to dangerous levels of environmental damage (such as associated with climate change or the depletion of fish stocks).

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Additional Value-added of SCAs• Aggregating up from the individual and the household

with the next stop being our communities and neighbourhoods and not only states or provinces.

• A wider perspective on well-being to incorporate all the aspects of individual and household experiences as well as those in community and society that are important to people.

• Spatial analysis is important. Move to non-administrative boundaries. Distinction between national and domestic.

• Estimating relationships amongst domains and indicators/variables. “Correlations are important” Fleurbaey 2009. (Determinants of Quality of Life). 10

• Using “equivalent incomes” to estimate impact of alternative social states. Fleurbaey, Van Praag.

• Making use of distributions e.g. “cigar diagrams.• Newer measures of low incomes such as the MBM

and the use of Foster, Greer, and Thorbecke measure of the poverty incidence, gap and intensity.

• Estimating indicators for communities that currently only exist at a more aggregate level (developing SAE algorithms).

• Gapminder “Motion Charts” to show relationships and dynamics.

• User determined aggregation weights to determine well-being. 11

More AV-A

More AV-A

• Evolution is important in planning policies now for the future. Developing agent interactive evolutionary models for neighbourhoods and communities associated with meta-micro (individual) databases.

• Interfacing with Google maps to provide layering and infrastructure location.

• Code to improve ease of input and editing as well as speed in output creation.

• Ability to optimally locate local services according to need.

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Conclusions

• Main contribution of Stiglitz and OECD work is to “legitimize” the framework and vision that others are pursuing.

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• Fleurbaey, Marc. 2009. “Beyond GDP: The quest for a Measure of Social Welfare” Journal of Economic Literature, 47(4): 1029-1075

• Stiglitz, Joseph E., Amartya Sen, and Jean-Paul Fitoussi. 2009. Report by The Commission on The Measurement of Economic Performance and Social Progress, www.stiglitz-sen-fitoussi.fr/en/index.htm

• European Commission. 2009. GDP and beyond: Measuring progress in a changing world, www.beyond-gdp.eu

• Power, Conrad. 2009. “A Spatial Agent-Based Model of N-Person Prisoner’s Dilemma Co-operation in a Socio-Geographic Community” Journal of Artificial Societies and Social Simulation, jass.soc.surrey.ac.uk/12/1/8.html

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