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Social Indicators Research

Erschienen in:

01.03.2013

Exploring Wider Well-Being in the EU-15 Countries: An Empirical Application of the Stiglitz Report

verfasst von: G. Madonia, M. F. Cracolici, M. Cuffaro

Erschienen in: Social Indicators Research | Ausgabe 1/2013

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Abstract

We draw on the recommendations of the Stiglitz Report to select a set of economic and social variables that can be used to make cross-country comparisons of wider well-being. Using data for the EU-15 countries for 1999 and 2005, we show how three-way analysis can be used to extract synthetic information from a large data set to determine the main latent explanatory factors. In our case, we identify one dominant factor that we term the development profile, which is positively associated with the level of education outputs, technological progress and female labour market participation and negatively associated with the level of pollution. We rank the countries according to this factor and compare these rankings with simpler GDP comparisons and find that the two rankings are only weakly correlated.

Vorheriger Artikel Quality of Life Satisfaction among Workers and Non-Workers in Uruguay

Nächster Artikel Subjective Well-Being Approach to the Valuation of International Development: Evidence for the Millennium Development Goals

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The aims of the Report were: “to identify the limits of GDP as an indicator of economic performance and social progress, including the problems with its measurement”; “to consider what additional information might be required for the production of more relevant indicators of social progress”; “to assess the feasibility of alternative measurement tools”; and, “to discuss how to present the statistical information in an appropriate way” (Stiglitz et al. 2009, p. 7).

Material living standards, Health, Education, Personal activities including work, Political voice and governance, Social connections and relationships, Environment, and, Insecurity.

There are other approaches, see Fleurbaey (2009) for an extensive account.

See the Report for more detail on the motivations for each of these dimensions.

The use of this approach in economics can be traced back to the so-called ‘Leyden School’, beginning with van Praag 1971 and van Praag and Kapteyn 1973.

See Diener et al. (1999) and Fleurbaey (2009) for recent studies on subjective well-being.

Moulin and Thomson (1997) discuss the origins of fair allocation and explain the specific criteria which characterise this approach.

See Fleurbaey (2009).

A typical example is inflation, where people perceive that their cost of living has gone up at a higher rate than the official measure would indicate.

“Current well-being has to do with both economic resources, such as income, and with non-economic aspects of peoples’ life” (Stiglitz et al. 2009, p. 11).

This refers to sustaining the current level of well-being over time and it depends on passing on to future generations stocks of natural, physical, human and social capital. See Stiglitz et al. (2009).

The DIIS Report (2010) also mentions the Stiglitz Report in their discussion of the multidimensional aspects of poverty but fails to integrate it in their conceptualisation of poverty. The authors are critical of the dimensions of well-being proposed in the Report.

The literature we review in this section can be described as following an objective approach, which is consistent with the empirical approach we adopt. Another strand of the literature takes a subjective approach, where well-being is measured using surveys that ask households how satisfied they are with their lives as a whole or with specific aspects of life (domains). A key reference here is Van Praag et al. (2003) (see also Van Praag and Ferrer-i-Carbonell 2004), who develop a model, where individual well-being depends on various domain satisfactions, including those relating to employment, health, and the environment. One of their key conclusions is that domain satisfactions can to a large extent be measured by objectively measurable variables.

On this point, see Hobijn and Franses (2001), Neumayer (2003) and Marchante and Ortega (2006).

For applications in the economics sphere, see e.g. Andolina et al. (1999), Andolina and Vassiliadis (2001), Figueiredo et al. (2008) and Figueiredo et al. (2011).

We tried to focus on the EU-27 but data are not consistently available for many of the variables.

For an exposition of the STATIS method, see Abdi and Valentin (2007). For applications of the STATIS method, see Chaya et al. 2003, Stanimirova et al. 2004, Figueiredo et al. (2008) and Figueiredo et al. (2011).

Its value is equal to 0.50 and 0.49 in 1999 and 2005, respectively.

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Titel: Exploring Wider Well-Being in the EU-15 Countries: An Empirical Application of the Stiglitz Report
verfasst von: G. Madonia
M. F. Cracolici
M. Cuffaro
Publikationsdatum: 01.03.2013
Verlag: Springer Netherlands
Erschienen in: Social Indicators Research / Ausgabe 1/2013
Print ISSN: 0303-8300
Elektronische ISSN: 1573-0921
DOI: https://doi.org/10.1007/s11205-011-9986-3

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