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)

saamah.abdallah@neweconomics.org

Tomas Hak, Charles University Environment Centre (WP1)

tomas.hak@czp.cuni.cz

Charles Seaford, nef (the new economics foundation) (WP3)

charles.seaford@neweconomics.org

, James Jordan