Governments increasingly say that as they pursue prosperity they need to make sure that success is shared among all citizens — across regions, genders and classes. But policymakers face a problem: what should they measure to make sure they’re achieving this goal?
On 29 May, the Organisation for Economic Co-Operation and Development (OECD) set out to answer this question. As part of a wider set of recommendations aimed at boosting inclusive growth, the OECD unveiled a “dashboard” of 24 indicators that measure whether a country’s economic and social performance is benefiting everyone.
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The new measurements show that, while OECD countries are improving in some areas, there are others in which they are going sharply backwards.
Between 2010 and 2015, while GDP per capita growth and productivity rose on average among the OECD’s 35 member states, rates of mortality from outdoor air pollution, confidence in government, and the number of people forced into part-time work against their will all worsened.
Speaking at the opening of the OECD’s annual forum in Paris, the organisation’s secretary-general Angel Gurría said: “We need to put inclusive growth at the heart of the multilateral system.”
Inequality, he said, “is personally unfair at the individual level, but it is also politically dangerous. It is corrosive for our economies”.
Gabriela Ramos, the OECD’s chief of staff, told a media briefing at the forum that she wants to start using the new dashboard indicators as leading measures of economic performance.
Policymakers should not, she said, blindly pursue economic growth in the hopes of redistributing some of it later, but factor in the impact of policies on a range of measure at every stage.
The measures that make up the OECD’s new dashboard are grouped into four categories.
The first examines economic growth, and how equitably a country is sharing that growth.
This includes traditional measures — among them GDP per capita growth — alongside more subtle indicators such as the wealth share of the bottom 40% and top 10%
A second category of measures looks beyond growth to the functioning of markets, and whether they are spreading prosperity fairly.
Figures grouped under this category include the female wage gap, the rate of involuntary part-time employment and the percentage of business loans that go to smaller companies.
The third category covers measures of wellbeing, intended to reveal how much opportunity people within a given country have to improve their happiness and take part in social and economic life.
Among these are the proportion of children enrolled in childcare, the gap in life expectancy between regions and the percentage of young people not in employment, education or training.
The final category looks at the standards of governance in a country, including levels of voter turnout and confidence in government.
As part of its wider policy recommendations, the OECD suggests that governments should boost investment in “people and places left behind”. Policy goals they recommend include improving adult and vocational education and cutting childhood obesity.
Governments, the OECD adds, should support “business dynamism”, for example by promoting the use of cloud computing technology.
And government itself has to keep reforming, the OECD’s framework added. It said “inclusiveness” should be embedded into all policymaking, with the influence of “narrow interest groups” curbed and gender and diversity goals included at all levels.
(Picture credit: Flickr/Sabishi Seishun)