1. Stiglitz Commission GDP and beyond
Robin Lynch
National Accounts in Practice – Advanced course
Luxembourg, 2-11 October 2017
THE CONTRACTOR IS ACTING UNDER A FRAMEWORK CONTRACT CONCLUDED WITH THE COMMISSION

2. Stiglitz Commission report
Commissioned in 2008 by President of France
chaired by economists and Nobel prize winners Stiglitz (USA) and Sen (UK, then USA)
Reported in 2009

3. Stiglitz Commission report
Why?
GDP seen as an accurate measure of economic growth, but . . .
Seen as a limited measure of income distribution and other “well-being” measures such as quality of life, environment sustainability etc.

4. Aims of Stiglitz Commission
Identify the limits of GDP
A) current measurement problems
B) additional information to cover social progress measures
C) feasibility of alternative measurements
D) How best to present the information

5. Stiglitz Commission report
Statistics are the information used to develop government policies to promote economic and social progress
Should current concepts be refined?
Should the scope of economic statistical measures be widened?

6. Stiglitz Commission report
Who is the report for?
Politicians
Policy makers and analysts
Academics, statisticians – users and suppliers
The public for better understanding of the issues (and so the media as popular presenters)

7. Stiglitz report - main messages
Current national accounts measures
Prices must reflect quality changes in deriving volume estimates of growth
Measure government “output” better – current methods do not allow productivity analysis
More focus on income & distributional measures

8. Stiglitz report - main messages
Shift emphasis from measuring economic output to people’s well-being
There is an increasing gap between measures of economic production and individual sustainable well-being
The statistical system should include measures of well-being and sustainability (environment degradation) that complement GDP measures

9. Stiglitz report - recommendations
Well-being is better caught in income and consumption measures, rather than production
2) Emphasise household view
3) Consider income and consumption jointly with measures of wealth
4) More emphasis on the distribution of income, consumption and wealth

10. Stiglitz report - recommendations
5) Broaden income measures to non-market activities 6) Improve quality of life data (health, education, democracy, etc.) 7) Quality of life measures must reflect inequalities in society

11. Stiglitz report - recommendations
8) Conduct more surveys into links between quality of life topics, to assist policy analysis 9) Statistical Offices should develop quality of life indices, incorporating different aspects 10) Statistical offices should survey subjective as well as objective views of society (are you as happy as last week?)

12. Stiglitz report - recommendations
11) Sustainability can be measured through a “dashboard” of appropriate indicators (avoids weighting and model issues) 12) Sustainability measurement needs more official indicators in physical units covering environmental damage. Pragmatic and not too much modelling and assumptions

13. What next? Discussion and research encouraged and continued
National and international agencies must decide what should be followed up, and how much should be invested

14. Happiness measures

15. how satisfied are you with your life nowadays?
to what extent do you feel the things you do in your life are worthwhile?
how happy did you feel yesterday?
how anxious did you feel yesterday?
People are asked to respond on a scale of 0 to 10, where 0 is “not at all” and 10 is “completely”.

16. Outcomes
Countries are measuring happiness and environmental sustainability
No great impact on policy yet