The Commission on the Measurement of Economic Performance and Social Progress (CMEPSP), generally referred to as the Stiglitz-Sen-Fitoussi Commission after the surnames of its leaders.[1] is a commission of inquiry created by the French Government in 2008. The inquiry examined how the wealth and social progress of a nation could be measured, without relying on the uni-directional Gross Domestic Product (GDP) measure.[2] The Commission was formed in February 2008 and Joseph E. Stiglitz was named as the Chair. Amartya Sen was the Economic Adviser and the French Economist Jean-Paul Fitoussi was the Co-ordinator. The Final Report was published in September 2009.[3] An additional contribution from the aforementioned three main organizers which specifically addresses the Financial Crisis (as of 2007) is also available.[4]
Jump up^ Jolly, David (September 14, 2009). "G.D.P. Seen as Inadequate Measure of Economic Health". The New York Times. Retrieved 29 January 2013.
Jump up^ http://www.stiglitz-sen-fitoussi.fr/documents/rapport_anglais.pdf
Jump up^ http://www.stiglitz-sen-fitoussi.fr/documents/overview-eng.pdf
Dr. Asad Zaman
Dis-satisfaction with existing measures of GNP led to the creation of a high-powered “Commission on the Measurement of Economic Performance and Social Progress” (CMEPSP) which included two Nobel Laureates, Joseph Stiglitz and Amartya Sen. The commission produced an eminently valuable document – the Stiglitz-Sen-Fitoussi (SSF) report – which provides the background for this concept paper on how we should improve measures of National Prosperity at the FBS in Pakistan.The SSF report argues that there are major defects in conventional measures like the GDP. Using these to gauge national progress is liken a sailor using a defective compass to navigate. Improved measurements are vital to assessment and implementation of good policy. The SSF report is required reading for improved data gathering of policy relevance at FBS. The first few pages of the SSF report provide an excellent Executive Summary. In this concept paper, we do not intend to provide a re-hash of the SSF report. Rather, we sketch an action plan for improved data gathering by FBS, in light of the recommendations of the SSF report. We first provide a summary of the recommendations, focused on high priority actionable items in the context of Pakistan. Next, we sketch an action plan based on these recommendations.
Summary of SSF Recommendations:
1. Instead of measuring aggregate wealth produced by the economy, measure income and consumption.
2. Emphasize the household perspective.
3. Consider income and consumption jointly with wealth. In particular, wealth should include stocks of physical, natural, human and social capital. When market prices and values are not available, natural non-market alternative evaluations should be considered.
4. Distribution of income, consumption and wealth should be given more prominence.
5. Broaden income measures to non-market activities.
6. Improve measures of health, education, personal activities, and environmental conditions. Also improve measures of social connections, political voice, and insecurity, which are highly correlated with life satisfaction.
7. Quality of life indicators in all dimensions should assess inequalities in a comprehensive way.
8. Design surveys to assess linkages between different dimensions of quality of life indicators.
9. Statistical Offices should provide enough information on each dimension to permit construction of different indices by aggregation according to different weights and conceptual frameworks.
10. Both objective and subjective well-being are important. Statistical offices should incorporate questions about subjective well being, including life evaluations, experiences, and priorities.
11. Measuring sustainability requires measuring stocks of resources of various kinds. This will require a multidimensional approach, and cannot be reduced to a single monetary figure.
12. Separate consideration of environmental measures, and assessment of dangers from environmental damage is essential.