Marco Mira d`Ercole

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Well-being measures and the future of EU Cohesion Policies

Perugia, Italy, 29 April 2010

Marco Mira d’Ercole

OECD Statistics Directorate

Two part presentation

1. OECD work on measuring well-being and progress

2. Implications for EU regional policies

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1. OECD work on measuring progress

Long tradition:

• 2001 publication ‘

The Well-being of Nations

’, 2005 report on ‘

Alternative

Measures of Well-being

• 2007, OECD launched the

Global Project

, in partnership with other IGOs and contributed to other initiatives (including Stiglitz Commission )

Today:

• An increasing number of high-level initiatives in individual countries (France, Germany, Japan, Italy, Korea, Slovenia, Spain, the

United Kingdom, China) and internationally (G20, EU Communication)

• One of six OECD priorities in 2011-2012, with substantial work programme in various Directorates

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Well-being Framework

OVERALL HUMAN WELL-BEING

Quality of Life Material Living Conditions

Work and life balance

Health status

Education and skills

Social connections

Civic Engagement and

Governance

Environmental Quality

Personal Security

Subjective well-being

Income and wealth

Jobs and earnings

Housing

GDP

Regrettables

SUSTAINABILITY OF WELL-BEING OVER TIME

Requires preserving different types of capital:

Natural capital

Economic capital

Human capital

Social capital

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1. OECD work on measuring progress

Ongoing OECD work under three pillars

• Methodological research to improve existing statistics and develop new ones where there are gaps, in the three areas of:

 material well-being (disparities in SNA, standards for household wealth, measures of non-market production of household services)

 quality of life (guidelines on SWB, social relations, vulnerability)

 sustainability (human capital, carbon footprint, intangible capital)

• Disseminating existing well-being statistics in How’s Life? publication

• Continued dialogue and outreach towards emerging and developing countries and civil society

 4 th OECD World Forum, New Delhi, fall 2012

 Regional conferences Latin America, Asia, Africa, Europe (2011/ 2012)

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2. Implications for cohesion policies

•Better well-being measures is not an end but a mean to better policies and better outcomes : different ways in which this can be achieved

The ‘virtuous policy cycle’

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2. Implications for cohesion policies

• One direct way is through the use of outcome indicators as targets for policies : “a systematic and rigorous use of well- defined outcome indicators is a very powerful tool for increasing

policy effectiveness” (HLG reflecting on Future of Cohesion Policy)

• Some of the details of the proposal could be controversial:

 Selection of targets (i.e. not all ‘outcomes’ indicators are about people, and not all well-being outcomes are ‘amenable to policy interventions’)

 balance between top/down and bottom/up approaches (i.e. outcomes chosen by each region or based on EU priorities, EU2020);

 requirement of ‘ comparability ’ of indicators among the

‘methodological principles’ (e.g. allocation of funds based on achievement of targets?)

• But the re-orientation of cohesion policies described by HLG is a radical one (with huge potential for the ‘measuring progress’ agenda)

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2. Implications for cohesion policies

Two main challenges:

Building a statistical infrastructure for regional statistics

Better metrics for some of the main factors of cohesion policies

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2. Implications for cohesion policies

Building a statistical infrastructure for regional statistics

 Most official statistics do not provide regional estimates for key indicators at conventional statistical levels: when the investment is made, the data show huge sub-national differences: INSERT 2

 Because of competing priorities (e.g. extending official statistics to other) and tighter NSOs budgets, ‘regionalisation’ unlikely to happen at the pace needed : HLG suggestion that “cohesion

policies.. finance move in this direction” is a critical one

 Building a statistical system at sub-national level requires combining different sources (not only surveys, but also administrative data, data-linking, modelling, GIS data): INSERT 3

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2. Implications for cohesion policies

Better metrics needed for some of the aspects that matter most for cohesion policies

HLG emphasis on “ using available data ” and on need that

“ selection and production of indicators should not become too burdensome ”: legitimate but…

 Some of the aspects that matter most for cohesion policies are not adequately measured in official statistics (e.g. quality of public services, communities ties, opportunities for political participation)

 Some of the critical concepts (e.g. income poverty) will require new thinking (e.g. national /regional thresholds? regional PPPs? Income including/excluding in-kind social transfers? )

 Local governments have role to play to trigger production of better statistics in these areas ; important as not all ‘aspects’ of a given outcome are supported by indicators; risk of distorting decisions towards what is measured (people rather than places)

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Conclusions

 “ Better statistics for better policies ” (OECD

Statistics Day, October 2010)  “Better policies for

Better Lives ” (OECD 50 th Anniversary)

 “ Good statistics are much cheaper than bad policies ”

Thank you marco.mira@OECD.org

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