Measuring Economic Welfare in the Digital Age: What and How?

November 19-20, 2018

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Call for Papers

The 6th Statistical Forum of the International Monetary Fund will take place in Washington, D.C. on November 19-20, 2018. ​The Forum is a platform for policymakers, academics, researchers, and compilers of economic and financial data to come together to discuss cutting-edge issues in macroeconomic and financial statistics and to build support for statistical improvements.

 

The theme of this year’s Statistical Forum is Measuring Economic Welfare in the Digital Age: What and How? Digitalization of economy and social interactions has renewed the demand for indicators of welfare beyond GDP, such as those highlighted in the Stiglitz-Sen-Fitoussi report (2009), and the IMF (2018) paper on Measuring the Digital Economy  The Forum Program Committee seeks proposals for empirical or conceptual papers on the measures needed to understand aspects of welfare not captured in standard GDP and price statistics, and on techniques for constructing these measures. Topics of primary interest are detailed in the draft Agenda below.

 

Authors interested in contributing a paper to the Sixth Statistical Forum should submit an indication of interest noting the preferred session(s) from those in the Forum’s agenda, and short abstract by Friday, June 1, 2018 to  STAForum@imf.org. Please use the contact author’s name as the name of the attached file. Authors of selected proposals will be contacted by Friday, June 22, 2018. The deadline for submitting a draft of the paper is October 8, and the final version and presentation is requested no later than October 31. In evaluating the proposals, the Program Committee will consider relevance to the theme and areas of interest of the Forum, originality, feasibility, and the importance of the contribution. Travel and hotel expenses of the presenting author will be covered by the conference organizers. Further information on the conference program will be posted on the IMF website www.imf.org.

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Preliminary Agenda

Session 1. Why do we need indicators of economic welfare beyond GDP? 

The rapid digitalization of the economy and social interactions has renewed the demand for indicators of welfare beyond GDP, such as those discussed in Stiglitz-Sen-Fitoussi (2009) or IMF Policy Paper on Measuring the Digital Economy (2018) . The Internet and smartphones have made available a wide range of new services, many of them free, that are not captured in private consumption. Digital products and information have also improved households’ ability to produce nonmarket services for their own consumption, while also giving them access to time-saving market services, such as online shopping. 

This session will examine issues such as: Why do we need measures of welfare that is directly linked to economic progress but not captured by existing GDP and price statistics?  While household non-market production (e.g., housekeeping, child care, cooking and services of volunteers) has been always recognized as a key element of welfare, has digitalization allowed household non-market production to grow faster than GDP?  Why are indicators of other aspects of welfare beyond GDP, including sustainability and the environment, policy-relevant?

 

Session 2.  What is economic welfare and its key features?

GDP is not a measure of economic welfare (although it has often been used as a proxy), but what exactly does “economic welfare” mean? This session will try to agree on a precise definition of economic welfare. Dimensions that need to be discussed include:

  • 1. Measures of willingness-to-pay and households’ nonmarket production of services for their own consumption; 
  • 2. Services of volunteers;
  • 3. Free products funded by advertising and collection of user data;
  • 4. Use of natural resources, including measurement of environmental degradation;
  • 5. Income and wealth distributions as complements to national accounts aggregates;
  • 6. Governance and corruption.

Session 3. Is digitalization all for the good? What are the negative side effects?

The Internet has proven to be an effective forum for promoting and amplifying misinformation, to the detriment of society, while at the individual level, digital technologies have been blamed for having addictive aspects that interfere with meaningful face-to-face social interactions, and for being a distraction that interferes with students’ learning and workers’ productivity. Are there useful statistical indicators of the detrimental effects on welfare? What kind of metrics can be developed to monitor these types of concerns?

 

Session 4. From theory to practice. How can we measure economic welfare? 

Supplementary indicators of economic welfare intended for regular release need to be feasible for statistical agencies to compile.

This session will examine what is needed to produce indicators identified in Session 1-3. It will review the methodology, data sources, and compilation techniques. It will distinguish between the ad hoc research on welfare and the regular production of indicators from the diverse national statistical systems. It will examine feasible solutions; for instance, are administrative and, more generally, “big data” promising data sources?

 

Session 5. Sustainability and environmental impacts

Historically, technological progress has been more than sufficient to offset effects of natural resource exhaustion and increasing scarcity of land, but this does not mean that sustainability can be taken for granted. Measures of welfare must therefore include indicators of sustainability over the longer run, such as comprehensive measures of sustainable consumption and wealth including natural capital. Net domestic product (NDP) captures one element of sustainability by allowing for depreciation, but omits environment impacts. Papers in this session will discuss innovations in the conceptual framework and estimation techniques for measuring sustainability, with practical applications that illustrate the usefulness of their proposed approach.

 

Session 6. What is the current state of play in official statistics for measuring economic welfare?

This session will present national experiences. National Statistics Offices are measuring some of the factors indicated in the earlier sessions. What are the recent successes and advances in developing supplementary measures of welfare?  What are the obstacles? Given that there are limited resources, what are the priorities from a national perspective? What are the resource implications?

 

Session 7. Priorities and constraints: benefit-cost analysis.

This session will focus on costs and benefits of developing the measures identified as priorities. In doing so, it will consider the large disparity in statistical capacity, resource constraints, and access to source data across the countries. Aspects of welfare that are important may be impractical to measure, and indicators that are feasible to compile on a regular basis may be of limited relevance. Which welfare measures are both key for policymaking and feasible? Considering the crucial importance of data sources, the availability of practical methods of estimation, and the resource constraints of statistical compilers, what should be the top priorities now, or as additional resources become available?

 

Session 8. Closing panel: Policy conclusions and Recommendations.