Well-being and multidimensional deprivation: some results from the OECD Better Life Initiative...
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Well-being and multidimensional deprivation: some results from the OECD Better Life Initiative Nicolas Ruiz
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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 production)
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The OECD Better Life Initiative
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Presents measures, analysis, and future statistical agenda on the dimensions that matters the most in people’s life
OECD Better
Life Initiative
How’s Life?
(report)
Your Better Life Index
(interactive web tool)
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 well-
being– 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
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Core framework
The OECD Better Life Initiative
• 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 place-
holders in a few cases
- comparable/standardized definitions
- maximum country-coverage- recurrent data collection
• Significant documentation and testing
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Selection criteria
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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Well-being through a fully disaggregated approach
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2009 2009 2010 2010 2009 2009 2009 2009 2009 2009 2000 2008 2009 2009 2010 2007 2008 2008 2008 2010 2010 2010
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
Well-being through a fully disaggregated approach
No strict well-being dominance
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Num
ber of green lights out of 22 headline indicators
Number of red lights out of 22 headline indicators
60%
Well-being through a fully aggregated approach
Your Better Life Index
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Well-being through a fully aggregated approach
• 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 sub-
dimensions (i.e. elementary indicators)– Setting the dimensional cut-offs– Setting the aggregation cut-off
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Well-being through a fully aggregated approach
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Indi
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Italy
Hung
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Slov
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Chile
Spai
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King
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Denm
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Neth
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Dep in 9 dim
Dep in 8 dim
Dep in 7 dim
Dep in 6 dim
Dep in 5 dim
Dep in 4 dim
Dep in 3 dim
Dep in 2 dim
Dep in 1 dim
Deprived in 0 dimensions
Well-being through a fully aggregated approach
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0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
1 2 3 4 5 6 7 8Number of dimensions in which people are deprived
Cumulative proportion of deprived, group of high well-being countries
Australia
Austria
Canada
Germany
Ireland
Luxembourg
Netherlands
New Zealand
Sweden
United Kingdom
United States
Denmark
Well-being through a fully aggregated approach
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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
India
Greece
Turkey
Hungary
Brazil
Chile
Italy
Slovakia
Indonesia
Spain
Poland
Czech Republic
Slovenia
United States
South Korea
Belgium
France
Finland
Japan
New Zealand
Canada
Germany
Ireland
Austria
United Kingdom
Netherlands
Australia
Sweden
Denmark
Luxembourg
Housing
Job
Income
Social Connections
Security
Civic engagement and governanceSubjective well-being
Health
Education
Environment
Subjective well-being and health in high well-being countries
Housing and social connections in low well-being countries
Well-being through a intermediate approach (work in progress)
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• 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?
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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