The nitty-gritty of going beyond GDP

Original Reporting | By Eric Kroh |

July 13, 2011 — It’s been more than 20 years since the United Nations Development Programme (UNDP) started publishing annual Human Development Reports “with the goal of putting people at the center of development, going beyond income to assess people’s long-term well-being.” Building on this model, many countries have adopted or adapted a “human development index,“ and, last year, the Affordable Care Act called for the creation of a “key national indicators” system in the U.S.

“People think you can put these things together and publish them and then something will happen,” said a senior advisor to the Canadian Index of Wellbeing project, but “I don’t think there will be uptake unless there’s a strong communication and education effort made.”

But Congress has yet to authorize funding for the project, and simply establishing an indicator system is no guarantee that its measures will become significant considerations in the crafting of public policy. The fundamental issue: do indicator systems work by attempting to “insulate” them from politics, or by attempting to have them do battle in the political arena by challenging those who don’t accept the importance of the indicators and by promulgating specific policy recommendations? If the answer were engagement, what steps would make a key national indicator system effective?


Limitations of GDP

The limitations of using GDP as the primary measure of a society’s progress have been well documented. The figure does not differentiate between goods and services that are beneficial and those that are not. For example, producing more cigarettes (and thus more disease), and producing more gasoline for cars stuck on the expressway (and thus speeding destructive climate change), both lead to an uptick in GDP; on the contrary, the work of the stay-at-home parent who provides care for his or her child every day is treated by the GDP as zero.  And GDP neither indicates whether economic benefits are flowing disproportionately to certain groups, classes, or interests within a society, nor says much about the subjective well being of a society’s population.

In the U.S., there have been many attempts on the regional, state, and national levels to go beyond GDP. For example, on the state level, an indicator system was first put in place in Oregon in 1991. On the municipal level, one city that has used human development indicators is Jacksonville, Florida.  On a broader scope, the not-for-profit American Human Development Project has produced “The Measure of America,” its implementation of a human development index for the country. (Remapping Debate’s previous edition featured a video interview with Sarah Burd-Sharps, co-author of “The Measure of America”).

But an official system for the U.S. is still at the starting gate, and serious questions remain as to how to maximize its efficacy.


If you build it, will they come?

Chris Hoenig is a senior adviser to the presidents of the National Academy of Sciences (NAS) and president of State of the USA, a nonprofit founded in 2007 with the goal of creating a comprehensive national indicator system. After passage of the Affordable Care Act, State of the USA partnered with the NAS to prepare for implementing the key national indicator system.

If Congress appropriates funding for the indicator system and the project goes forward, the NAS will identify the human development areas to be addressed by the key national indicators, determine the measures that will be used, and choose where the data will come from (see box).


The dimensions to be covered by the “key national indicators” for the U.S. have not yet been determined by the National Academy of Science, said Chris Hoenig of State of the USA, although he expects those dimensions to include aging, civic and cultural life, crime and justice, economy, education, energy, the environment, families and children, governance, health, housing, infrastructure, innovation, safety and security, and transportation.

Two similar programs that are currently in place are the Human Development Index (HDI) of the U.N. Development Programme and “The Measure of America” of the Social Science Research Council’s American Human Development Project.

The HDI is a composite index that factors in health, education and standard of living to arrive at a single number to represent a country’s development.

In the most recent Human Development Report, the HDI takes into account four indicators: life expectancy at birth, mean years of schooling, expected years of schooling, and gross national income per capita. Countries are then ranked according to HDI. The report also compiles an HDI that adjusts for inequality and publishes a “gender inequality index.”

Like the U.N.’s HDI, “The Measure of America” uses the three dimensions of health, education and standard of living, but employs different indicators. “The Measure of America” factors in life expectancy at birth, educational degree attainment, school enrollment, and median earnings.

An interactive map on the American Human Development Project website allows users to visualize disparities in HDI across the country and rank states and congressional districts according to composite HDI or its components, or according to a host of other indicators on the environment, housing and transportation, political participation, and security.

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