See part one here, part two here, and part three here.
Workshop session: Growth and Reconsidering Happiness.
Since my French is horrible, and there were no translators for this session, my notes will be much sparser. We began by hearing Isabelle Cassier discuss GDP, and compare the resulting trend lines of per-capita GDP with a measure of life satisfaction. Tremendous growth in the GDP was not reflected in life satisfaction measures across time and across countries.
Looking at the chronology the evolution of the GDP and the Life Satisfaction indicator from all the western countries after 30 years. In comparison internationally, there's no correlation evident, for example, between Brazil and Japan.
l'argent ne fait pas le bonheur/money can't buy happiness
What do the economists say? Three families of explanations about the difference between measures of economic growth and life satisfaction:
A. Wealth is relative
man changes and is adaptable (the effect of the surroundings)
man is a social animal (Aristotle) (the effect of social comparisons)
B. Wealth isn't everything
Of a number of elements, none are as well-defined and well-constructed over many years as the GDP, of all things contributing to life satisfaction
Some of the factors affecting well-being include:
inequalities/ lack of social justice
changes in work conditions
family and social relations
governance and institutions
Reflections about the indicators:
Indicators of what? What concepts should we keep?
Progress (social/societal/of societies)
Wealth (material, immaterial)
Well-being (utility, being)
Quality of Life (individual, collective, sustainable)
Prosperity (economic, state of happiness)
Happiness (individuals separately/connected, universal)
Revive the question of a model society
Neither growth nor de-growth: good-bye to outcomes
Individual or collective?
Diverse symptoms of living together
Poverty of the the individualism methodology and of the analyses or the indicators that we collect
Meda: recognize the existence of a community that has different interests
Goods in common can draw attention away from individual liberty
Stiglitz Commission: quality of life; we measure the QOL of the whole society in the actions of individuals
Objective indicators create a universal norm we can discuss; subjective indicators deny the existence of one society, of a common Good?
Risk 1: replace the debate about the outcomes for one or two indicators: a technocratic governance model
Risk 2: an opinion indicator represents universal outcomes: a model of unique development
Risk 3: Need to measure the non-quantifiable (happiness): preserve the happiness to economists
are institutions ready for radical change?
Measure and improve the progress of societies
measure without a definition?
Progress: only one definition?
Improve: role of the public pouvoirs
Society: whose society?
Dimensions few present for discussion:
Considerable economic interests with the old measures: resistance to change
Aspects of reparation or redistribution: can't have change without redistribution
Historical perspective: what was the news of 1944 (compatible national constitutions and cap growth): what's the news today?
Impact of the financial crisis:
What to do?
Contribute to the redefinition of finalities
reduce our own incoherence
Denounce? Expose? them of institutions and governments
Dennis Stokkink addressed “The impact of economic growth on poverty and inequalities: the importance of political choices, of indicators and of their definitions.” Our goal is both economic growth and equality for one and for all. The question of economic growth automatically applies on an individual level to questions of poverty and inequality. He turned the rest of the time (and the PowerPoint presentation) over to Marion Englert.
There exists a merger implicit between economic growth and the different approaches to well-being, both social and subjective well-being. The subject of the study she is reporting on is the relation between economic growth (and poverty and inequality) and income/revenue. Poverty is a multidimensional concept. The postulate is that the maximization of the size of the pie allows a increase in each of its slices, suggesting that the increase in the GDP contributes to social development and reduces poverty. The question then becomes: does the real world support this postulate? Is there an evidentiary link between theory and technique?
Examine growth and redistributive capacity
Explore the example of countries of high revenue
Review the temporal approach (historical)
Examine international comparisons
(Ed. Note: There may have been a couple more steps in their plan, but this is all I caught.)
First, we have to understand Absolute v. Relative Poverty. We have an intuitive perception that what we mean by poverty varies in different times and different places. Poverty can be measured through social comparisons – does this family have as much money as others in the society? -- or through social exclusion principles – does this family have enough money to fully participate in society?
Pertinence of the concept of relative poverty
the question is not about the size of the share but about the relative size of the share
Growth and redistributive capacity
differenct effect depends on the mode of growth: productivity vs. employment rate
increase in productivity
augmentation of revenues
growth of productivity does not imply positive redistribution (without fiscal reform)
growth of besoins with GDP (generosity relatively constant)
redistribution is a political choice
increase in employment rate
growth results from an increase in employment diminishes relative poverty in the condition of the absence of working poor and the public fiscal policy remains the same.
The existence of the working poor (living precariously at unequal salaries)
Possible annulment of the positive effect of employment growth in th function of fiscal policy
temporal approach (historical evolution of inequality in relative poverty)
Fordism v. post-fordism
Characteristics of the types of regulation/deregulation post fordiste:
Reviving ideology: predominance of neo-classical and liberal ideology
Approach the level of international comparisons
After sharing graphs on the rate of relative poverty in higher-income countries, marion Englert concluded with the results of the economic analysis:
Per capita GDP does not influence the level of the variations in inequality and relative poverty, but is positively correlated with other variables.
Per capita GDP shouldn't always be considered the only indicator of global poverty, though it is an appropriate indicator to highlight overall poverty in some countries.
Redistribution as public policy is particularly effective in the reduction of inequalities and relative poverty, and is not correlated with per capita GDP
Levels of poverty and inequality are dependent on societal choices and political decisions that respond to social objections.
One of the comments was in English, so I can share it with you. In response to the question about what people needed to be comfortable with their quality of life, in 1994 American surveyed said they needed $80,000 to be comfortable, while in 2004 those surveyed needed $200,000 to feel comfortable. The conclusion is that people never think they have enough. The second comment is about the futility of trying to address global poverty through economic growth. Under our current economic model, we would need 30 planets to reach the amount of economic growth needed to eliminate poverty globally.
New speaker: Laurent Jolia-Ferrier, from the Societe Mesurer le developpement durable spoke on the topic of “Indicators for a new look at human development and societal well-being.” He discussed a project developed for the Ile-de-France region with a wider application.
The beginning: L'IAURIF has a base of 400 indicators of the environment, society, and economy for this region
The fact: these indicators, indispensable to specialists, are not allowed to communicate simply with the greater public
The need: Discover a methodology to create a synthetic measure of regional performance of the region in matters of the environment, society, and economy.
The tools tested have been judged unable to be adapted to this use, so we needed to create a tool we could use for our own.
Developing a methodology and an authorized tool:
The intent was to synthesize certain indicators in 3 levels, so that one could move from the simple to the more disaggregated and precise/specific:
Level 1: 2 indexes (environment and social-economic)
Level 2: 10 indexes (earth, water, air, flora and fauna, resources, public health, wealth, knowledge and culture, community, equality)
Level 3: 30 indexes
We also needed to be able to compare the performance of several collective areas between themselves, and reflect the political impacts in different places as a result of this work after a reasonable amount of time. We needed to validate the indicators with experts for each domain, including which indicators to keep, the sources of the domains used, and the management of the consolidation of the proposed indicators.
We were running short of time, so we went quickly past the objectives of the study and the commentary page on the slideshow, and spent a little more time looking at the results of the tool when comparing the counties of western Europe in environmental performance and socio-economic performance. Then we compared the results with a couple of other indicator frameworks.
Sandrine Michel and Delphine Vallade were up next, talking about “Social expenditures financing and long term economic growth: the contribution of a synthetic index of the development of men.” I think this is Delphine Vallade speaking.
We begin by examining economic growth over the long term: the contracyclicity and procyclicity of the expenditures for mankind since 1945. The study is problemmatic:
Is it possible to interpret the recurrent contribution of the expenditures at the exit of crisis with the structural irreversability of growth? Are these expenditures a unitary characteristic? Proposition of a synthetic indicator. Let's begin with a discussion of works about these indicators and our reflections.
Three dynamic works around the measures of growth and the nature of wealth: production very dense of alternative indicators
Social indicators and collective well-being: The conventions of evaluations of progress (Gadrey 2002)
Social indicators and the measure of wealth
(I missed the other titles)
[DS = depenses sociales – that was the key I needed to understand the previous slide which used the abbreviation liberally. I'm sure she said what the abbreviation stood for, but I just didn't catch it.]
We looked at social expenditures – with an interesting graph examining social expenditures for education from 1850 to 2004 along with the trend line. Further graphs looked at social expenditures for education, health, and old age.
Then we saw a graph that overlaid social expenditure spending with GDP (again 1850-2004) showing lower social expenditures during economic recessions. It's my lack of language clarity raising its ugly head again – as she covers the different economic periods and relative social expenditures, I can't tell which of the variables she is suggesting is causative – whether poor economic times lead to lower social expenditures, or lower expenditures lead to economic recessions, or if the two are coincidental. She's asking, what are the determinants of the movement in these trend lines? Demography? Economy? The historical analysis is very interesting, but I can't answer her questions. The concept of looking back to be able to, as she puts it, study the financial solutions that prevailed in times long ago is an interesting idea. The years immediately prior to 1945 aren't just an example of economic shortfalls – it was a time of enormous upheaval in France, and barring a further occupation, I'm not sure if we can draw any really good conclusions from that time period.
More charts, and really neat timelines. Plus a few slides that seem to be trying to meet the challenge of “how many French words can you fit on one page before PowerPoint self-destructs?” I'm afraid the lateness of the hour (it's now 7:00 p.m. and we've been in sessions since early this morning), combined with jet lag, are magnifying the language barriers. I am prepared to admit that this presentation is revolutionary in its thinking and exemplary in its application. I just hope someone else is taking notes who will be willing to share them. I apologize to Delphine Vallade for these notes.
We have a dinner next – I hope it's unstructured without presentations. I'm speaking first thing tomorrow morning, and my head is starting to hurt.
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Thursday, October 30, 2008
See part one here, part two here, and part three here.