Community Indicators for Your Community

Real, lasting community change is built around knowing where you are, where you want to be, and whether your efforts are making a difference. Indicators are a necessary ingredient for sustainable change. And the process of selecting community indicators -- who chooses, how they choose, what they choose -- is as important as the data you select.

This is an archive of thoughts I had about indicators and the community indicators movement. Some of the thinking is outdated, and many of the links may have broken over time.

Wednesday, September 5, 2007

Index of Economic Well-Being

Last fall I had an opportunity to spend some time with Lars Osberg at a conference put on by PEKEA. The conversation about indicators of social progress was energetic and productive, which was readily apparent even though most of it was in French.

I bring this up to pass on the exciting work Lars Osberg has been doing with an Index of Economic Well-Being. He makes the point that increases in real per capita income or national GDP alone do not answer the question "are you better off today than you were four years ago?" (One of Dr. Osberg's papers, The Measurement of Economic Welfare, points out that Ronald Reagan used that line to win the U.S. presidency, even though per capita disposable income was higher in 1980 by 8.8 percent than it was in 1976.)

The Index measures four components of economic well-being:

  • Effective per capita consumption flows, including consumption of marketed goods and services; government services; effective per capita flows of household production; leisure; and changes in life span.
  • Net societal accumulation of stocks of productive resources, including net accumulation of tangible capital; housing stocks; net changes in the value of natural resources stocks; environmental costs; net changes in the level of foreign indebtedness; accumulation of human capital; and the stock of R&D investment.
  • Income distribution, including the intensity of poverty (incidence and depth) and the inequality of income.
  • Economic security from job loss and unemployment, illness, family breakup, and poverty in old age.

You can read a series of talks, articles, and presentations from Dr. Osberg on his website.

The question "are you better off?" is a personal one, and can really only be answered by individuals. The real question for social policy (and for the social indicators that support or direct that policy) should be: "is the community better off?"

That's what indicators of social progress are trying to measure, and Dr. Osberg's Index provides one way to answer that question. It's worth checking out.


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