Why 12 Quality of Life Indicators?

Our Indicators range far beyond the traditional national accounts of GNP and GDP and other money-denominated indexes on inflation (CPI), incomes, interest rates, trade deficits, and the national budget. Our indicators dig deeper, going behind the national statistics on employment, health, education, the state of our infrastructure and national security. We pioneered the use of a “dashboard” of our 12 indicators displayed with equal weighting on our website in 2012.  This “dashboard” model devised by our Advisory Board member Jochen Jesinghaus, is now a widely used alternative to GDP.   We are not trying to offer reweighted and recalculated versions of macroeconomic statistics modeled on GDP, as many other worthy efforts have attempted. Our approach is to paint a broader picture of quality of life to complement current statistics and identify statistical “blind spots” where new data collection is needed.

In all the indicators we created, with the help of experts in each area, we present a model linking the major factors and processes, providing a roadmap of how decisions flow through various institutional structures to create outcomes. These systems models help identify why in each area the United States has succeeded or fallen short in achieving its stated policy goals. We identified the “holes” in the statistical pictures and where data gathering needs new focus. Thus, our 12 unbundled indicators came together as a broader pattern represented in our logo, the 12-slice colored pinwheel. At the same time, we have retained the richness and detail of each of the 12 domains. This systems approach allows us to display the wealth of diverse data rigorously, without the loss of detail which plagues any single index approach. In each indicator, the domain it covers is related to all the other indicators.

The 12 indicators were selected using many sources. Firstly, they are major areas of public concern as reflected in public opinion polls, the media, political campaigns, and debates over decades.  Secondly, these domains are most often covered in many of the existing sets of local state, national, and international statistics we reviewed.  However, few integrate so many diverse elements as the  Ethical Markets Quality of Life Indicators or include such groundbreaking approaches. Each one of our indicators is grounded in demographic data, allowing revealing insights often invisible in highly averaged indices.

Ethical Markets commissioned Globescan in 2007 to survey eleven representative countries worldwide for the BEYOND GDP Conference in the European Parliament in 2007 (www.beyond-gdp.eu).  This survey found large majorities in all these countries favoring expanding measures of national progress beyond money-denominated GDP to include indicators of wealth, education, poverty gaps and environmental quality.  Similar results were found in follow-up surveys in 2010 and 2013.

The Beyond GDP surveys confirm earlier polls on governmental reform by the highly respected Americans Talk Issues Foundation (see Locating Consensus for Democracy, Alan F. Kay, 1998).  Americans were asked if they approved or disapproved of the following proposal:

“In the same way we’ve developed and use the Gross National Product to measure the growth of the economy, [we should] develop and use a scorecard of new indicators for holding politicians responsible for progress toward other national goals, like improving education, extending health care, preserving the environment, and making the military meet today’s needs.”

In these two surveys, the first taken in March of 1993, 72% of the American people agreed that such quality of life indicators were needed. These results were verified in a debate format where an opposing view was offered in the second survey in January of 1994:

“Opponents say that eventually economists will be able to calculate a single indicator of progress, a kind of enlarged GNP, that bundles into this money-based statistic our progress in all major areas including the economy, health, education, the environment, and so forth. This single number would be easier for everyone to use to rank ourselves against other nations and to judge the performance of our political leaders.”

Only 22% of respondents found this opposing view to be convincing, and when the original question was asked again, support went up to 79% (Kay 1998).

A similar debate methodology is used in our Beyond GDP surveys where respondents are asked which of these two statements is closer to their view:

• “The government should measure national progress using money-based, economic statistics because economic growth is the most important thing for a country to focus on.”
• “Health, social and environmental statistics are as important as economic ones and the government should also use these for measuring national progress.”

Each of our 12 indicators is in context with the rapid transformation our society is experiencing, and how each indicator may evolve to capture such changes in our world. The indicators are presented in alphabetical order to reflect our belief that each domain is equally important in understanding quality of life in a holistic manner.