Measuring wellbeing – the latest from UN and OECD. But can Costa Rica, Dominican Republic and Jamaica really be the world’s happiest countries?!

August 11, 2009

     By Duncan Green     

The criticisms of GDP as a pretty unreliable measure of well-being have been around for decades, but policy makers persist in using it as a proxy for success, in part because of the lack of credible alternatives. Now there’s an encouraging flurry of international activity at both the UN and OECD that seeks to fill the gap.

In October the OECD’s ‘Measuring the Progress of Societies’ project is holding its 3rd world conference in South Korea (for conference details see here, for previous blog, here). I’ll be attending along with thousands (well, hundreds) of statisticians. You can imagine my excitement.

Over at the UN, the Human Development Report, published by UNDP, has long been one of the most influential annual reports on development. Now, according to its director Jeni Klugman, ‘The HDR 2010 will take stock of 20 years of Human Development Reports and undertake a systematic examination of the evidence about trends in human development outcomes over two decades. This will go beyond the Human Development Index (HDI), and other related indices, to include inequality and broader aspects of poverty, agency and empowerment. It is well recognized that the HDI captures only a few people’s choices and leaves out many that people may value highly – economic, social and political freedom and protection against violence, insecurity and discrimination.’

According to Klugman, ‘The world has changed since 1990 and these changes, along with new data and research technology, should be reflected in measures of human development, poverty, and gender:
• There has been progress in people’s well being broadly defined.
• Ideas have advanced: for example, there is nowadays a consensus about the need for multidimensional responses to development challenges and a wider acceptance of Sen’s ideas on capabilities, functionings and freedoms but practice lacks behind.
• HDI is a minimalist measure of development, but the challenge is to take measurement beyond the HDI.
• New opportunities to enhance human development have emerged, such as channels for democratic activity and participation, including global participation, information technology, cooperation around concrete goals such as the MDGs, and institutional reforms at various levels.
• Conversely, new or renewed challenges to human development progress have emerged related to: deprivation traps, inequality, natural and man-made disasters, conflict, and environmental degradation.
Although these patterns have already highlighted key candidates for adjustments to the HDI, such as inequality and environmental sustainability, complementary measures are also important, including a new poverty measure and justice and freedom indicators.’

So the HDR team are open for suggestions on the following questions:

1.          In your country or region, have human development indices (HDI, HPI, GDI, GEM) been instrumental to promote a multidisciplinary approach to development issues beyond the economic dimension? Can you provide concrete examples?
2.          What are the main challenges in promoting human development measurement in the development debate within your country or region?
3.          Being aware that human development and poverty are much more than what the HDI or HPI measure, and bearing in mind alternative national instruments, how could the these indices best be enhanced to reflect the ‘state of the art’ insights and techniques, globally and at the national level?
4.          Acknowledging that steering analysis, reflection and action, and not ranking countries, is the main purpose of the yearly calculation of the HDI, what could be alternative ways to present the HDI or other alternative indices?
5.          Your views on how justice, respect for human rights and freedom of choice may be measured are encouraged. Can they be integrated into a general development index such as the HDI, or should a separate index on these issues be considered?

For further reading, visit the HDR website. If you want to get involved, sign up by emailing (or have a look at the HDRnet webpage).

And meanwhile, according to the New Economics Foundation’s ‘Happy Planet Index’, which combines reported life satisfaction, life expectancy and happy planet regional breakdownecological footprint, the world’s happiest country is Costa Rica, followed by Dominican Republic and Jamaica (see chart for regional breakdown). Eh? Now even as a proud Latin Americanist, that’s what I call (when I’m being polite) ‘counter-intuitive’…… For an interactive map go here.

August 11, 2009
Duncan Green