The Economics of Enough_ How to Run the Economy as if the Future Matters - Diane Coyle [130]
• shift some current aid funding (a relatively small amount will be sufficient) to finance R&D on mobile and web applications that will improve information flows in developing economies;
• and to finance the training of officials so that they can monitor and collate statistics.
In fact, user-generated statistics could be useful in Western economies too, although they will prove essential in poor economies. Conventional economic statistics in the OECD countries are collected by surveys of businesses or shops or individuals. It’s an expensive process as the surveys need to be very large scale. The statisticians should look at using “user-generated content” and new technologies in order to cut costs and make the transition that’s needed in the figures they collect.
There has already been significant innovation in measurement of the economy, as will be clear from some of the examples given in earlier chapters. This includes time use surveys, which I believe will need to be refined and more widely adopted to understand trends in both well-being and productivity in services. It includes also something like both the process and the outcome of the statistics in Measuring Australia’s Progress. The indicators in this publication are selected via a public consultation and provide the wider array of measures of the economy indicated by the well-being debate. In addition, the OECD (in its “Measuring Society’s Progress” project) and the Sen-Stiglitz Commission for President Sarkozy of France have made recent contributions to the debate about supplementing GDP with other indicators. So on this particular question there has been much research already, with a high degree of consensus as to how to go about it; and the issue now is putting the weight of resources and political will behind it. Involving the wider public in the selection of indicators seems to me essential, not only for its legitimacy but also because it’s their well-being that is supposed to be the object of the exercise.
There has also been a good deal of work on improving current GDP statistics, measuring intangible value and productivity in services, as described in chapter 6, including by leading agencies such as the Bureau of Economic Analysis, the Australian Bureau of Statistics and the Office for National Statistics. This is a detailed and complicated area of research. It strikes me as increasingly Ptolemaic. The astronomer Ptolemy, making careful observations of the heavens in the first century AD, realized that the view of God’s universe with the Earth at its center did not match the evidence. His response was to adapt the earthcentric view to what he saw in reality by adding complicated cycles and minicycles on to the supposed circuit of the sun around the earth; changing to a suncentric theory was a step too far. In the same way, the statistical framework is currently introducing complicated adjustments to the existing measurement of output and productivity. The action really is in the adjustments, such as the “hedonic” techniques used to adjust prices of items like computers for quality improvements. However, the key thing is again to put political weight and also resources into continuing this research, as there will be no shortcut to a new framework.
VALUES
This book has covered such a wide range of policies that it isn’t possible to set out in any detail the responses needed across the board, from environmental policies to pensions and welfare to financial reform. The details will differ greatly from country to country anyway. Nevertheless, the diagnosis set out in this book points to some clear areas for reform and also some clear principles.
The first of these principles is stewardship, the need to ensure that future generations will have at least as much as our own. Lengthening the time horizon for policymaking, whether thinking about carbon emissions or government debt, is an urgent priority.
The second is revalorization,