Monday, September 14, 2009

Seeking better ways to evaluate a nation’s well-being

How to tell whether a country is making progress? Experts have been grappling with that question for years under the auspices of the Organization for Cooperation and Economic Development (OECD).

They have now come up with recommendations that will be discussed at the October 27-30 OECD World Forum on “Statistics, Knowledge, and Policy” to be held in Busan, Korea.

The goal is to reach an international consensus on indicators that transcend the traditional one, the Gross Domestic Product (GDP), which measures a nation’s total flow of goods and services.

It’s time to end “GDP fetishism,” Joseph Stiglitz, the Nobel Prize-winning economist, told a Bloomberg reporter last week. “So many things that are important to individuals are not included in GDP. There needs to be an array of numbers, but we need to understand the role of each number. We may not be able to aggregate everything together.”

In a September 14 announcement OECD Secretary-General Angel Gurria observed that there is a growing gap between what official statistics state and the conditions under which people live their daily lives. “This gap,” he said, “can be clearly damaging both to the credibility of political debate and action and to the very functioning of democracy in our countries.“

The World Forum
in Korea is part of a global project on measuring the progress of societies, initiated by the OECD five years ago.

A newly released draft OECD working paper sets out a proposed framework to measure that progress – a framework “broad-based and flexible enough to be applied in many situations around the world.”

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