Paris School of Economics - L'Agence Française de Développement

More documents

Recommendations

Info

expectancy, malnutrition — without necessarily expecting to be able to combine them into a complete ordering (Sen, 2009). Sen’s concerns must be taken seriously, but whether or not SWB measures have the sort of bias identified by Sen is an empirical matter, at least in part. Nothing rules out the possibility that some SWB measures are good indicators of capabilities, and even if they cannot serve as overall indicators, they are certainly important measures in their own right: it is surely better to be happy than sad, to be carefree than to be worried, and to perceive one’s life as going well rather than badly. On this empirical evidence, the jury is still out. In particular, there is no complete resolution of the Easterlin (1974) paradox that at least some measures of SWB have not increased with economic growth, although Stevenson and Wolfers (2008) have made some progress in that direction. If economic growth brings no increase in SWB, most economists still tend to believe that this reveals the deficiencies of SWB measures, and not follow Easterlin and Layard into the belief that economic growth does not improve the human lot. It turns out that it is important not to treat all SWB measures as the same because they correspond to different aspects of well-being. In particular, measures of momentary affect (or affect yesterday) capture current hedonic well-being — the experiences that make up the emotional texture of life — while life evaluation measures capture, not people’s current feelings, but how they think about their lives, the distinction between experiencing life and thinking about it (Kahneman and Riis, 2005). Across countries, the Cantril life evaluation measure (a scale of 0 to 10 from the worst possible life to the best possible life) is astonishingly well predicted by (the logarithm of) per capita GDP, both among individuals and national averages (Deaton, 2008). Within the contemporary United States, hedonic experience responds to household income, but satiates at an income level of around $75,000, whereas life evaluation continues to rise with income (Kahneman and Deaton, 2010). There is at least the possibility here that life evaluation measures do respond to economic growth over time, which would help resolve the Easterlin paradox, although we do not yet have long enough time series of the Cantril measure to know. December 2011 / Measure for Measure / How Well Do We Measure Development? / © AFD [ 23 ]
1.2. The 2005 revision of the ICP and its consequences 1.2.1. Background The rounds of the International Comparison Project are like successive Olympic Games. Like the Olympics, they do not happen every year, and in the first modern games only a few countries sent competitors. There were only a few events, and standards of competition were relatively low. The participants were amateurs with day jobs, and while they were great natural athletes, they did not take their training very seriously. Yet the first modern Olympics was a watershed, which eventually grew into the record-breaking, professional event that it is today, in which almost all of the nations of the world come together into a truly global competition. The ICP began in the late 1960s and early 1970s with Alan Heston, Irving Kravis, and Robert Summers from the University of Pennsylvania, and Zoltan Kennessy from the United Nations. The first round in 1967 had only six countries with four more added in 1970, and prices were collected for only a small range of goods and services. Since then, each round had become bigger and better (and more expensive), with more countries represented, with the involvement of more and more professional statisticians and economists, and with lots of preparatory training in the form of expert workshops, theoretical papers, and figuring out how to deal with problems that could not be solved in the previous round. The 2005 round was by far the most professional, the biggest, the most thoroughly researched, and the most international — with 146 countries. ICP 2005 incorporated many improvements over the previous round in 1993, and perhaps the simplest summary is that the statistical procedures were so much better that the new estimates of PPPs are not really updates of the old, but a whole new set of incomparable numbers. In 1993, many countries had their PPPs imputed, because no price data were collected for them; these absentees included both India and China. The definitions of commodities and services were much more carefully specified in ICP 2005. And perhaps most importantly, the regional structure of the ICP was complemented by a strong global office, run by the World Bank, which developed and implemented a coherent plan for transforming a system of regional PPPs into a global set of estimates. The 1993 round was not centrally coordinated or controlled and, in the face of underfunding at the center, became a set of regional exercises, carried out at different times, each of which collected data and calculated regional PPPs. A UN report in 1997, under the chairmanship of Jacob Ryten, concluded that the estimates from ICP 1993 were not credible and concluded, with faint praise, that “the ICP is a programme worth keeping but that its current condition, if little is done about it in terms of credibility, quality of output, and survival prospects, is poor ”. The linking of the regions in the ICP 2005 is not without its problems. The most serious of these are not failings of the ICP itself, but reflect conceptual differences in making com- [ 24 ] © AFD / Measure for Measure / How Well Do We Measure Development? / December 2011
Page 1 and 2: Measure for Measure How Well Do We
Page 3 and 4: [ Disclaimer] Publications Director
Page 6 and 7: Table of Contents Acknowledgements
Page 8 and 9: Introduction François Bourguignon,
Page 10 and 11: The 2010 UNDP report on human devel
Page 12: 1. Measuring Development: Different
Page 15 and 16: More data, better data and a broade
Page 17 and 18: •The PPPs are currently revised o
Page 19 and 20: 1.1. More data, better data: benefi
Page 21 and 22: Organization undertakes the World P
Page 23: able through the DHS system, as wel
Page 27 and 28: international dollars. The line is
Page 29 and 30: only thing that changes the counts
Page 31 and 32: Table Countries 1 15 reference coun
Page 33 and 34: y India and China, where about half
Page 35 and 36: This is because the PWT uses a Gear
Page 37 and 38: price level is the ratio of the pur
Page 39 and 40: meeting the demands of disease and
Page 41 and 42: In contrast to the calorie decline,
Page 43 and 44: 1.3.4. Asking about not having mone
Page 45 and 46: Table 3 All countries Estimated num
Page 47 and 48: 1.4. From many to one: single index
Page 49 and 50: expectancy and per capita income
Page 51 and 52: DEATON, A. (2008), “Income, healt
Page 53 and 54: STEVENSON, B. and J. WOLFERS (2008)
Page 56 and 57: 2. Multidimensional Poverty and its
Page 58 and 59: dimensional Poverty Index. While th
Page 60 and 61: erty in most countries, but is sign
Page 62 and 63: The first methodology in Figure 7 e
Page 64 and 65: more completely their characteristi
Page 66 and 67: 2.1.3. Unfolding M0 A relevant feat
Page 68 and 69: 2.2. One particular application of
Page 70 and 71: Whenever the poverty cutoff k requi
Page 72 and 73: deprivation in child mortality and
Page 74 and 75:
2.3. Research questions and debates
Page 76 and 77:
Table Identification Method Union a
Page 78 and 79:
There are three kinds of combinatio
Page 80 and 81:
from different data sources; data f
Page 82 and 83:
Because of its construction, analys
Page 84 and 85:
2.4. Concluding remarks This paper
Page 86 and 87:
ATKINSON, A.B. and F. BOURGUIGNON (
Page 88 and 89:
ERIKSON, R. (1993), "Descriptions o
Page 90 and 91:
RAWLS, J. (1971), A theory of justi
Page 92 and 93:
Comment: Multidimensional Poverty a
Page 94 and 95:
Data Already existing surveys provi
Page 96:
Taking a longer historical view und
Page 100 and 101:
3. Will GDP Growth Increase Subject
Page 102 and 103:
political scientists. However, most
Page 104 and 105:
instruments/instrument.php for a su
Page 106 and 107:
• Life expectancy/income: “A pe
Page 108 and 109:
clude that: “Overall, the average
Page 110 and 111:
period. A similar graph appears in
Page 112 and 113:
Mean life satisfaction Figure 11.C
Page 114 and 115:
Figure 12 GDP, and the average and
Page 116 and 117:
3.1.2. The diminishing returns to i
Page 118 and 119:
3.1.3. “Rather than diminishing m
Page 120 and 121:
3.1.4. Is the time-series correlati
Page 122 and 123:
Figure The happiness trend in Mexic
Page 124 and 125:
A note on statistical power The dis
Page 126 and 127:
Satisfaction Figure 15.B. Happiness
Page 128 and 129:
Life Satisfaction Life Satisfaction
Page 130 and 131:
Life Satisfaction 7.62 7.3 7.08 6.8
Page 132 and 133:
insignificant in a well-being equat
Page 134 and 135:
p.21). Whether the co-movements bet
Page 136 and 137:
Mean happiness in survey (0-10 scal
Page 138 and 139:
One important note that can be made
Page 140 and 141:
well-being regressions in which bot
Page 142 and 143:
and relative to the income they ear
Page 144 and 145:
(2010), dummy variables for one’s
Page 146 and 147:
3.3.2 Adaptation Adaptation and the
Page 148 and 149:
Knight and Gunatilaka (2009) is an
Page 150 and 151:
Life expectancy at birth Infant mor
Page 152 and 153:
Average number of children per woma
Page 154 and 155:
Infant mortality per 1 ,000 live bi
Page 156 and 157:
Trust 8 6 4 2 Evolution of trust We
Page 158 and 159:
gradient across countries, if incom
Page 160 and 161:
Table Last year Min. Max. Source Fi
Page 162 and 163:
The income-happiness nexus: sources
Page 164 and 165:
References AKAY, A. and P. MARTINSS
Page 166 and 167:
COJOCARU, A. (2010), “On relative
Page 168 and 169:
FREY, B.S. and A. STUTZER (2000),
Page 170 and 171:
MCBRIDE, M. (2001), “Relative-inc
Page 172 and 173:
Comment: Will GDP Growth Raise Well
Page 174 and 175:
is relatively uncontroversial as an
Page 176 and 177:
Again, perhaps one ought to advise
Page 178:
4. “Sustainable Growth”: Do We
Page 181 and 182:
ethical matter and needs to espouse
Page 183 and 184:
Adjacently but independently of the
Page 185 and 186:
4.1. National income and social wel
Page 187 and 188:
In 1970, William Nordhaus and James
Page 189 and 190:
4.2. The challenge of sustainabilit
Page 191 and 192:
nerable to uncontrollable diverging
Page 193 and 194:
The final goods and services genera
Page 195 and 196:
Since the variation of total real n
Page 197 and 198:
It is to be noted that the discount
Page 199 and 200:
This difference is such that the di
Page 201 and 202:
4.4. Sustainable growth: measuring
Page 203 and 204:
Human capital is embodied in people
Page 205 and 206:
Box 3 The notations have already be
Page 207 and 208:
4.5. Sustainable growth: measuring
Page 209 and 210:
the marginal utility of income and
Page 211 and 212:
non-felling of trees. This non-use
Page 213 and 214:
Box 4 Cost-benefit approach The fun
Page 215 and 216:
With respect to the exogenous techn
Page 217 and 218:
duced on the pollution permit marke
Page 219 and 220:
paths. The social discount rate is
Page 221 and 222:
should then be converted into econo
Page 223 and 224:
References AGHION, P., D. HEMOUS an
Page 225 and 226:
KRAVIS, I., A. HESTON and R. SUMMER
Page 227 and 228:
Comment: “Sustainable Growth: Do
Page 229 and 230:
sustainable policies. It seems very
Page 231 and 232:
References SHALIZI, Z. and F. LECOC
Page 234 and 235:
AFD Agence Française de Développe
Page 236:
Authors’ Biographies
Page 239 and 240:
een that of relative utility or com
Page 241 and 242:
What is AFD ? Agence Française de
show all

Paris School of Economics - L'Agence Française de Développement

Create successful ePaper yourself

Delete template?

Save as template?