Taking economic growth out of the social progress conversation

For roughly a quarter of a century, the UN has put out a report on how countries are improving or declining each year. The dense report is boiled down into a single index that compares countries against each other and themselves. Each report is followed by criticisms about what is included and left out.

This year is no different, but there is a new twist.

Enter the Social Progress Index. Consider it to be a competitor to the UN’s Human Development Index. It took tries to determine how well countries are doing with a notable difference: it does not take into account  the GDP’s of countries.

As a result, countries like Iraq and Saudi Arabia, which are bolstered by oil revenues, do much worse on the Social Progress Index than the Human Development Index. That major difference is exactly why economic measures like GDP are excluded, says Michael Green, Executive Director of the Social Progress Imperative, the group behind the index.

“There are limits in what the HDI is measuring,” said Green to Humanosphere. “If you include GDP in your well-being measure, you are then mixing up the economic and the social.”

Three main measures are used to determine the social progress of each country: basic human needs, foundations of well-being and opportunity. The three cover a range of areas from access to clean water to education to freedom of speech. The rights-based issues that make up the opportunity category are, like GDP, missing from the UN’s index.

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“Our analysis is that Saudi Arabia is lagging not leading on many aspects of well-being, particularly on rights and freedoms,” said Green.

He hopes that the index will question the very foundation of development that relies heavily on economic growth. The group will soon release sub-national data on Brazil, further showing how regions are progressing. Such information will help countries as they graduate into middle-income status.

“Everyone is talking about inclusive growth. They all have different definitions. Some people will talk about financial inclusion, others about jobs, and others about income inequality,” said Green. “Frankly I don’t think anyone knows what it is.”

There are still many similarities between the two indices. The usual suspects, including Switzerland, Norway, Sweden and New Zealand are at the top of both. Same goes for many of the bottom ranking countries, like Chad, the Central African Republic and Burundi.

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Other criticisms of the UN’s recent report hones on on what is contained. Or more precisely, what is missing from it. Duncan Green of Oxfam Great Britain found that the report was short on issues like power and politics. There are plenty of recommendations and calls for more to be done, he blogs, but there is little thought about getting it done.

“It argues for a return to full employment as an economic policy objective. That’s a brave and radical proposal, but fails to acknowledge, let alone discuss, any possible trade-offs between full employment and decent jobs – it wants both (natch),” writes Duncan Green.

The different points made by Green and Green are meant to illustrate some of the gaps in the report. It has also led to further engagement with the UN about its report.

With the UN listening, what will the 2015 edition of the index look like? Maybe more like this?

Social Progress Index

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About Author

Tom Murphy

Tom Murphy is a New Hampshire-based reporter for Humanosphere. Before joining Humanosphere, Tom founded and edited the aid blog A View From the Cave. His work has appeared in Foreign Policy, the Huffington Post, the Guardian, GlobalPost and Christian Science Monitor. He tweets at @viewfromthecave. Contact him at tmurphy[at]humanosphere.org.

  • CASSE3

    Growth is uneconomic when it increases environmental and social costs by more than it increases production benefits, as is the case in much of the world. While GDP is unrelated to human well-beiing, it is still a good measure of the size of an economy. Because there is a fundamental conflict between growth and environmental protection, GDP is also a good indicator of environmental impact.

    http://steadystate.org