Beyond GDP: OECD Well-Being Initiative

1. Measuring what matters in people’s lives: the OECD Better Life Initiative and beyond Romina Boarini OECD Statistics Directorate Qatar Statistics Day Forum Doha 10 December 2013

2. Presentation outline OECD well-being framework > Applying the framework > Extending the framework • The OECD framework for measuring well-being > motivation, context, content 2. How the OECD framework has been applied > Better Life Index, How’s Life?, country reviews 3. How the OECD framework can be extended to non-OECD countries

3. 1. OECD framework for measuring well-being OECD well-being framework > Applying the framework >Extending the framework

4. Why measure well-being? OECD well-being framework > Applying the framework > Extending the framework OECD 50th anniversary: Better policies for better lives • How to measure better lives? • …addressing the well-known limits of traditional economic measures, such as GDP per capita, for capturing wider well-being and the progress of societies

5. The problem with GDP OECD well-being framework > Applying the framework > Extending the framework • GDP never designed to measure people’s well-being: • Counts only what has a price: goods and services exchanged on the market; public services • Offers an aggregate picture: does not on inform on how resources are distributed across the population • It is static: does not tell about well-being in the future • GDP growth does not correlate with: • People’s sense of well-being (e.g. Easterlin Paradox, life satisfaction trends and the Arab Spring) • Trends in household’s perceived living standards • Evolution in other socio-economic outcomes • The value of GDP: • An indicator of macro-economic performance and in particular of the supply potential of the economy • Economic growth is “only” a means to Better Lives

6. Recent calls to go ‘beyond GDP’ OECD well-being framework > Applying the framework > Extending the framework • Stiglitz-Sen-Fitoussireport (2009) • EU 2020 and Communication on “GDP and beyond” • UN Resolution 65/309 (2012): “Happiness: towards a holistic approach to development” • Rio+20 “The Future We Want” declaration, June 2012 • Wide range of national initiatives

7. Well-being indicator projects - worldwide OECD well-being framework > Applying the framework > Extending the framework

8. OECD well-being framework OECD well-being framework > Applying the framework > Extending the framework

9. 2. Applying the OECD well-being framework: How’s Life? 2013 OECD well-being framework > Applying the framework > Extending the framework

10. Wide (and growing!) range of applications OECD well-being framework > Applying the framework > Extending the framework In-depth statistical reports:How’s Life? 2011; 2013 Building well-being measures into OECD country reviews: Economic Surveys (Austria, USA, Australia)How’s Life in Israel? , Multidimensional Country Reviews (Myanmar, Philippines, Uruguay) Communicating with citizens and the media: Your Better Life Index website www.oecdbetterlifeindex.org

11. Indicator selection: measurement goals OECD well-being framework > Applying the framework > Extending the framework • Key question: Is life getting better, and for whom? • Focus on peoplerather than economic system or GDP • Measure well-being outcomesrather than inputs and outputs • Describe both averagesand inequalitiesin well-being • Capture bothobjectiveand subjective aspects of life • Be relevant to well-being both today and tomorrow

12. Indicator selection: guiding principles OECD well-being framework > Applying the framework > Extending the framework Relevance • face valid • easily understood • policy relevant Data considerations • official or established sources; non-official place-holders • comparable/standardized definitions • maximum country-coverage • recurrent data collection • can be disaggregated by population groups

13. Just released: How’s Life? 2013 OECD well-being framework > Applying the framework > Extending the framework Job quality: Well-being in the workplace Gender gaps in well-being The human costs of the financial crisis How’s Life at a glance: 25 headline indicators How to measure the sustainability of well-being over time

14. How’s life in 2013? OECD well-being framework > Applying the framework > Extending the framework Canada Germany Greece

15. The global financial crisis has had a profound impact on people’s well-being OECD well-being framework > Applying the framework > Extending the framework Life satisfaction dropped as unemployment increased Source: How’s Life? 2013 X-axis: Life Satisfaction =average score on a 0-10 scale ; source: OECD calculations on the World Gallup Poll Y-axis: Long term unemployment rate= % of the labour force unemployed for one year or more; source: OECD Labour Force Statistics

16. The crisis also affected other aspects of life OECD well-being framework > Applying the framework > Extending the framework Trust in governments declined But new forms of solidarity emerged Percentage of people reporting to trust national government Percentage of people reporting having helped someone, 2007=100 Source: OECD calculations on Gallup World Poll

17. Communicating with media and citizens: the Better Life Index OECD well-being framework > Applying the framework > Extending the framework

18. The Better Life Index: lessons so far OECD well-being framework > Applying the framework > Extending the framework BLI users’ weights (50000 observations) • 3 million people from all over the world • Life satisfaction, health and education matter most • Community and work-life balance more important for women, income more important for men

19. 3. Extending the well-being framework to non-OECD countries OECD well-being framework > Applying the framework > Extending the framework

20. Goals OECD well-being framework > Applying the framework > Extending the framework • Does the How’s Life? framework resonatewith the concerns of non-OECD countries? • Holistic view of progress and human development present in the vision of many countries • Many ongoing initiatives on measuring well-being in emerging economies • The OECD framework covers universal aspirations for better lives • What type of adjustments are necessary? • Things that are taken for granted • Data context • Resources and capacity • What applications are possible? • How’s Life in country/region X? • OECD Multidimensional Country Reviews

21. Methods OECD well-being framework > Applying the framework > Extending the framework • Review of national and international practices in measuring well-being and human development • Develop a framework that builds on the How’s Life dimensions and features but integrates non-OECD specific well-being issues and indicators • Output: Conceptual Guide on Measuring Well-Being for Development • Done by OECD Development Centre and Statistics Directorate, possibly mainstreamed in the OECD Development Strategy

22. Towards an extended framework - well-being here and now

23. Towards an extended framework - well-being there and then OECD well-being framework > Applying the framework > Extending the framework

24. OECD well-being framework > Applying the framework > Extending the framework • Thank you! • to learn more about our work: • www.oecd.org/progress • www.oecd.org/howslife • www.oecdbetterlifeindex.org • romina.boarini@oecd.org