1. Well-being measures and the future of EU Cohesion Policies
Perugia, Italy, 29 April 2010
Marco Mira d’Ercole
OECD Statistics Directorate

2. Two part presentation
OECD work on measuring well-being and progress
Implications for EU regional policies

3. 1. OECD work on measuring progress
Long tradition:
2001 publication ‘The Well-being of Nations’, 2005 report on ‘Alternative Measures of Well-being’
2007, OECD launched the Global Project, in partnership with other IGOs and contributed to other initiatives (including Stiglitz Commission)
Today:
An increasing number of high-level initiatives in individual countries (France, Germany, Japan, Italy, Korea, Slovenia, Spain, the United Kingdom, China) and internationally (G20, EU Communication)
One of six OECD priorities in , with substantial work programme in various Directorates

4. Well-being Framework OVERALL HUMAN WELL-BEING GDP Quality of Life
Material Living Conditions
Work and life balance
Health status
Education and skills
Social connections
Civic Engagement and Governance
Environmental Quality
Personal Security
Subjective well-being
Income and wealth
Jobs and earnings
Housing
GDP
Regrettables
SUSTAINABILITY OF WELL-BEING OVER TIME
Requires preserving different types of capital:
Natural capital
Economic capital
Human capital
Social capital

5. 1. OECD work on measuring progress
Ongoing OECD work under three pillars
Methodological research to improve existing statistics and develop new ones where there are gaps, in the three areas of:
material well-being (disparities in SNA, standards for household wealth, measures of non-market production of household services)
quality of life (guidelines on SWB, social relations, vulnerability)
sustainability (human capital, carbon footprint, intangible capital)
Disseminating existing well-being statistics in How’s Life? publication
Continued dialogue and outreach towards emerging and developing countries and civil society
4th OECD World Forum, New Delhi, fall 2012
Regional conferences Latin America, Asia, Africa, Europe (2011/ 2012)

6. 2. Implications for cohesion policies
Better well-being measures is not an end but a mean to better policies and better outcomes: different ways in which this can be achieved
The ‘virtuous policy cycle’

7. 2. Implications for cohesion policies
One direct way is through the use of outcome indicators as targets for policies: “a systematic and rigorous use of well-defined outcome indicators is a very powerful tool for increasing policy effectiveness” (HLG reflecting on Future of Cohesion Policy)
Some of the details of the proposal could be controversial:
Selection of targets (i.e. not all ‘outcomes’ indicators are about people, and not all well-being outcomes are ‘amenable to policy interventions’)
balance between top/down and bottom/up approaches (i.e. outcomes chosen by each region or based on EU priorities, EU2020);
requirement of ‘comparability’ of indicators among the ‘methodological principles’ (e.g. allocation of funds based on achievement of targets?)
But the re-orientation of cohesion policies described by HLG is a radical one (with huge potential for the ‘measuring progress’ agenda)

8. 2. Implications for cohesion policies
Two main challenges:
Building a statistical infrastructure for regional statistics
Better metrics for some of the main factors of cohesion policies

9. 2. Implications for cohesion policies
Building a statistical infrastructure for regional statistics
Most official statistics do not provide regional estimates for key indicators at conventional statistical levels: when the investment is made, the data show huge sub-national differences: INSERT 2
Because of competing priorities (e.g. extending official statistics to other) and tighter NSOs budgets, ‘regionalisation’ unlikely to happen at the pace needed: HLG suggestion that “cohesion policies.. finance move in this direction” is a critical one
Building a statistical system at sub-national level requires combining different sources (not only surveys, but also administrative data, data-linking, modelling, GIS data): INSERT 3
Modular approach to regionalisation in household income statistics in the US:
CPS ASEC, sample of around 100,000 addresses, national estimates
ACS, sample of around 3,000,000 addresses, estimates by states and counties (annually), for units of less than 20,000 people (by pooling 3 years of data) and census tracks and blocks units (by pooling 5 years of data.
SAIPE (modelling) produces every year estimates of median income and poverty by states and countries, and population and poverty by school district.

10. 2. Implications for cohesion policies
Better metrics needed for some of the aspects that matter most for cohesion policies
HLG emphasis on “using available data” and on need that “selection and production of indicators should not become too burdensome”: legitimate but…
Some of the aspects that matter most for cohesion policies are not adequately measured in official statistics (e.g. quality of public services, communities ties, opportunities for political participation)
Some of the critical concepts (e.g. income poverty) will require new thinking (e.g. national /regional thresholds? regional PPPs? Income including/excluding in-kind social transfers? )
Local governments have role to play to trigger production of better statistics in these areas; important as not all ‘aspects’ of a given outcome are supported by indicators; risk of distorting decisions towards what is measured (people rather than places)
NSI can not respond alone to the increasing demand of information (ex. Social capital)

11. Conclusions
“Better statistics for better policies” (OECD Statistics Day, October 2010) “Better policies for Better Lives” (OECD 50th Anniversary)
“Good statistics are much cheaper than bad policies”
Thank you