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Planning Commission deputy chairman Montek Singh Ahluwalia (second from right) with OECD secretary general Angel Gurria (second from left) and other ministers during the inauguration of 4th OECD World Forum in New Delhi on Tuesday. Photo: Shahbaz Khan/PTI  (Shahbaz Khan/PTI )
Planning Commission deputy chairman Montek Singh Ahluwalia (second from right) with OECD secretary general Angel Gurria (second from left) and other ministers during the inauguration of 4th OECD World Forum in New Delhi on Tuesday. Photo: Shahbaz Khan/PTI
(Shahbaz Khan/PTI )

Looking for indicators of progress beyond GDP

The OECD forum is discussing how to make the aspirations of the common man relevant to policymaking

New Delhi: In the face of a deepening economic crisis and social resistance to austerity measures, world leaders are considering a collective experiment to include parameters such as well-being and happiness in national and international statistics.

The Organisation for Economic Co-operation and Development’s (OECD) World Forum on Measuring Well-being for Development Policy Making being held in New Delhi from 16-19 October is discussing how to make the aspirations of the common man relevant to policymaking and look beyond gross domestic product (GDP) as an indicator of progress.

Experts say developing an internationally comparable wellbeing index across countries is key to measuring economic progress, with objective and subjective well-being, sustainable growth, environmental security and other aspects such as education, health, income and personal safety playing a role in national policymaking.

“Fiscal consolidation measures are leaving citizens affected," said Algirdas Semeta, the European Union commissioner for European statistics, referring to the recent protests in the euro zone against austerity measures.

He argued that the worsening economic crisis makes including and monitoring targets for strengthening social cohesion such as employment, inequality and environmental sustainability as important as economic measures to ensure democratic accountability of governments.

Countries need to not only measure economic progress, but also well-being as measured by the effectiveness of public policy in improving education, healthcare and the state of the environment, Srikant Jena, minister of state for statistics and programme implementation, said while inaugurating the conference.

In a video message, British Prime Minister David Cameron said GDP was an incomplete way of measuring progress. “GDP is a useful indicator, but it cannot give us a general picture of whether life is improving," he said, arguing for change in the policymaking process.

India’s 12th Five-Year Plan (2012-17) goes beyond maximizing GDP growth, said Montek Singh Ahluwalia, deputy chairman of the Planning Commission.

At India’s income level, ignoring GDP entirely would be impossible, he said. GDP measures goods produced, not negative externalities, such as damage to the environment and biodiversity, pollution and over-exhaustion of limited natural resources, he said. “These problems have now reached a scale where they cannot be ignored," he said.

Economists and political scientists are uncomfortable with a simple-minded linkage between economic growth and human development, said T.C.A. Anant, secretary, ministry of statistics and programme implementation. However, a paradigm shift in policymaking will be a major challenge for statisticians, he said.

Nearly 800 participants from around the world, including statisticians, academicians and policymakers, will reflect at the conference on ways to measure subjective well-being and include it alongside conventional methods of mapping economic progress. The forum seeks to discuss and develop a consensus over how measures, objective and subjective, relating to well-being should be collected and used with conventional measures of income in domestic policymaking and international comparisons.

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