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 Some of the thinking is outdated, and many of the links may have broken over time.

Friday, April 18, 2008

In Praise of GDP

We've been talking about the need for broader indicators of progress than the Gross Domestic Product, and that need has launched an international summit and a new presidential commission in France.

Turns out, however, that some folks like the GDP just fine, thank you very much, and don't want it meddled with. Justin Fox opines in TIME magazine:

...[C]ompiling a reliable measure of all the economic activity in a country as big as this one is hard. Which is something to consider whenever you hear somebody arguing that GDP ought to be shelved in favor of some more holistic measure of economic well-being. Somebody like, say, French President Nicolas Sarkozy, who early this year appointed a high-powered task force--boasting not just one but two economics Nobelists, Amartya Sen and Joseph Stiglitz--to devise a GDP replacement. Similar "ditch-GDP" noises can be heard frequently from enlightened sorts who care a lot about the environment, health care, education and happiness.

Now, there certainly are measures of economic and societal success that we ought to pay more attention to. But ditch GDP? Perish the thought.

One reason the GDP is getting a lot more love lately comes from the work by Betsey Stevenson and Justin Wolfers where they show a positive correlation between GDP and happiness. From The New York Times report:

“The central message,” Ms. Stevenson said, “is that income does matter.”

To see what they mean, take a look at the map that accompanies this column. It’s based on Gallup polls done around the world, and it clearly shows that life satisfaction is highest in the richest countries. The residents of these countries seem to understand that they have it pretty good, whether or not they own an iPod Touch.

If anything, Ms. Stevenson and Mr. Wolfers say, absolute income seems to matter more than relative income. In the United States, about 90 percent of people in households making at least $250,000 a year called themselves “very happy” in a recent Gallup Poll. In households with income below $30,000, only 42 percent of people gave that answer.

Here's the chart they reference:

What are your reactions?


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