Composite Indicators: When and How To Use Them

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Composite Indicators When and How To Use Them

• Jon Hall
• Global Project, OECD

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Composite Indicators

• A powerful tool for advocacy
• A way to promote debate
• But they can be controversial

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Potential Users

• Civil Society
• Bureaucrats
• Politicians
• Media
• Citizens

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Potential Users Potential Uses

• If I was from Civil Society

How would I use acomposite indicator?
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Potential Users Potential Uses

• If I was from Civil Society
• To lobby government, the media, the public about
  issues of concern
• To focus debate within my organisation on issues
  of concern

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Potential Users Potential Uses

• If I was from a Bureaucrat

How would I use acomposite indicator?
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Potential Users Potential Uses

• If I was from a Bureaucrat
• To portray issues of concern to ministers - to
  galvanise action and keep focus
• To demonstrate that policies are having an effect
• To encourage joined up government
• NOT to design detailed policy proposals

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Potential Users Potential Uses

• If I was from a Politician

How would I use acomposite indicator?
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Potential Users Potential Uses

• If I was from a Politician
• To demonstrate to voters the need for new
  perhaps difficult policies
• To demonstrate to voters that policies are
  working

The political economy of reform
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Potential Users Potential Uses

• If I was from the Media

How would I use acomposite indicator?
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Potential Users Potential Uses

• If I was from the Media
• To tell an exciting story the public like
  composite indicators
• To communicate complicated issues in a simple way
• The Happy Planet Index

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A Happy Planet Index

• Launched by nef in July 2006
• HDI style rank order of nations
• Measure of the Ecological efficiency with which
  human well-being is delivered
• Over 1,000,000 downloads to date

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What HPI measures
Human system
Ecosystem
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What HPI measures
Human system
Human well-being
Happy and Long Lives
(divided by)
Resource Use
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What HPI measures
Human system
Human well-being
(Life Sat) (Life Exp)
(divided by)
Eco Footprint
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Potential Users Potential Uses

• If I was from a Citizen

How would I use acomposite indicator?
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Potential Users Potential Uses

• If I was from a Citizen
• To participate more effectively in democratic
  debate? Lobby my government, write to my member
  of parliament? Decide on who to vote for?
• Change my behaviour. Consume less resources?
  Move to another country?

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But .

• Potential Uses are many and can be very
  important
• Vital that we are transparent about the
  limitations of composite indicators
• Vital that we are transparent about the
  assumptions within them
• Be clear about what they explain and do not
  explain
• Great as a tool for simplifying a complex story
• Great as a way to initiate a debate

But they seldom tell the whole story
But dont oversimplify
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• Everything should be as simple as it is, but not
  simpler.
• - Albert Einstein