1 / 30

Motivation

New Directions in Welfare OECD 6-8 July 2011, Paris Theories of justice and the measurement of well-being Guillermo Alves – Matías Brum – Andrea Vigorito Instituto de Economía Universidad de la República - Uruguay. Motivation.

dominica
Download Presentation

Motivation

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. New Directions in WelfareOECD6-8 July 2011, ParisTheories of justice and the measurement of well-beingGuillermo Alves – Matías Brum – Andrea VigoritoInstituto de EconomíaUniversidad de la República - Uruguay

  2. Motivation • Recent discussion on the dimensions to be considered for comparisons across countries, held internationally (Sarkozy commision, UNDP, World Bank, Foro Consultivo Mexico) • Availability of international indexes (Better Life Index, Human Development Index, Human Opportunity Index) • Available measures consider different dimensions and use different aggregation procedures, leading to different country rankings • Main indexes (GDP, BLI, HDI) and measures exclude important items in their calculation: • Inequality (lacking in HDI until 2009, BLI soon) • Agency/Autonomy (though UNDP has made attempts) • Uruguay: local discussion on how to measure the impact of the recent redesign of the social protection system

  3. Correlations btw diff rankings of OECD countries

  4. Main purposes • Principles underlying social indicators • Theories of justice and the dimensions of well-being: a proposal • An empirical exercise - International rankings: a comment - Trends: an application to Uruguay • Final comments Outline of the presentation

  5. Main purposes • Drawing from the main contemporary approaches to justice and justice theories, discuss which dimensions should be taken into account for well-being comparisons • For each approach, identify the informational basis needed in order to make comparisons. This implies: • Choosing relevant indicators • Choosing a combination procedure for the indicators • Approaches covered in our paper: • Utilitarism, Welfarism, Libertarianism, Egalitarian liberalism (Rawls, Dworkin), Equality of Opportunities (Roemer), Capabilities Approach (Sen) • Stress the importance of inequality as an important (even central) feature to be taken into account when comparing countries

  6. Principles underlying social indicators • Principles guiding the system (Atkinson et al, 2002) • Balance among the different dimensions • Consistency among components • Transparent and accessible for all systems • Levels of importance must be determined • Principles guiding individual indicators (Atkinson et al, 2002) • Identify the essence of the problem and have a clear normative interpretation • Robust and statistically validated • Responsive to policy interventions but not subject to manipulation • Comparable at international standards • Timely and susceptible to revision • Required data should not impose a large burden to states or statistical offices • Databases to be considered • Household , individual surveys microdata • Firms and organizations microdata • National accounts system data • Administrative records, laws, decrees, norms

  7. Theories of justice and thedimensions of well-being: a proposal

  8. III.1 Utilitarianism and Welfarism • Both approaches base interpersonal comparisons on subjective well-being • Nevertheless, for a long time interpersonal comparisons carried out in Economics used data on income or consumption • Recently, subjective evaluation has been favoured by a stream of the economics profession led by the new Economics of hapiness. • Whereas Utilitarianism considers aggregate utility, Welfarism considers also its inequality or dispersion.

  9. III.1 Utilitarianism and Welfarism • Utilitarianism as sum of individual utility • Welfarism as inequality in utility

  10. III.2 Libertarianism (Nozick) • Assesses first generation civil and political rights, economic freedom and property rights • Regarding negative freedoms, egalitarian treatment relies in the supression of all barriers to these freedoms • Main dimensions considered under this approach are: • The warranty of fundamental freedoms • The vigency of a judicial system • Circulation freedom • Freedom of expression, asociation, right to strike and demonstrations • Economic freedom • Warranty of property rights

  11. III.2 Libertarianism (Nozick)

  12. III.3 Egalitarian Liberalism (Rawls) • Rawls’ twojusticeprinciplesestablishthegroundforcomparisons • Thefirstprincipleimpliesthatbasicfreedoms are abovetherest of thedimensions (lexicographicpriority) • Thesecondprincipleistwofold: establishestwoconditionsthat are necessaryfortolerance, and topreventsituationsof social inequality: • - Equality of possibilitiestoaccessjobs and positions • - Differenceprinciple: inequalitiesneedtoturninto a majorbenefittothelessadvantagedmembers of society. • Dimensions: accesstoprimarygoods • - Social basis of self-respect • - Wealth • - Income • Operationalization has manycaveats: • - Identification of lessadvantagedgroups • - Unidimensionality of disadvantage (basedonincomeonly) • - Tolerancetohighinequalitylevels (withoutcontradictingtheDifferencePrinciple)

  13. Lexicografic priority to basic freedoms

  14. Equal access to positions and the difference principle

  15. III.4. Roemer’s equality of opportunity • This approach distinguishes between circumstances (out of control of the individual) and effort. Only inequality due to differences caused by external circumstances is “unfair”. • The isolation of the portion of inequality due to external circumstances is a difficult task as long as effort is correlated with circumstances • Recent attempts of operationalization include: i) ex-ante and ex-post approaches; ii) parametric and non parametric decompositions of inequality (Ferrando, 2011) • In this proposal we concentrate in providing indicators that can approximate inequality of opportunity • The selection of the relevant dimensions is a key issue, although it has been less controvertial than in the capabilities approach • The dimensions that have been currently used in empirical literature are health, work, education and income

  16. III.5 Capabilities approach (Sen & Nussbaum) • This approach considerably broadens the informational basis used to carry out interpersonal comparisons • Sen separates well-being (functionings and capabilities) and agency • Within the CA, there are different positions in relation to the dimensions to be considered in well-being and agency assessments. Whereas Sen leaves this task to communities and researchers, Nussbaum advocates for the definition of a list of universal combined capabilities. Alkire and Robeyns also argue for the existence of a list but not necessary the Nussbaum one. • This approach has significant operationalization problems

  17. Freedom indicators: additions to egalitarian liberalism

  18. Basic functionings & capabilities indicators

  19. Dimensions and indicators- agency and autonomy

  20. IV. AnEmpiricalexcercise

  21. IV.1 A comment on international rankings

  22. IV.2 The proposed dimensions and assessments of well-being over time: some results for Uruguay • Covering 2001-2008 • Data from our National Household Survey and from Latinobarometer • Information missing / incomplete / unavailable for some years and/or indicators: our paper makes a proposal regarding this missing data • As expected, the different informational basis and indicators lead to different stories regarding what happened in the period • In some cases, even within an approach, different indicators evolve in the opposite direction

  23. V. Final Comments • Based on previous research, we propose dimensions to carry out comparisons consistent with the main contemporary approaches to distributive justice • Broadening the informational basis entails significant increases in the number of relevant indicators as well as on data sources, and advances in the two fields are required • Results are sensitivetothechoice of dimensions and indicators • Whenoperationalizatingdifferentconceptions • In some cases philosophicaldifferencestendtofade • In others, approachesempiricallyoverlap

  24. V. Final Comments • A large effort in data collection needs to be done in the fields of agency and freedoms • As long as household surveys are built on the basis of traditional approaches to well-being, they need to broaden the dimensions in which they broaden their informational basis. Particularly relevant for developing countries • Aggregate indicators or separate indicators? Since evolution may be different and even in opposite direction, among other reasons, we make our case for a disaggregate view • Approaches to justice are embedded in indexes; inequality and agency should not be left behind.

  25. Thanks for your attention

More Related