Creating a new index

Tyler Cowen proposes several.

Indexes are informative, easy to digest, and remarkably well-suited for social-media sharing. At their best, they can actually be fun. Creating more of them is one way social scientists can satisfy the growing public hunger for knowledge and accountability.

In a blog post, he asks,

Which indices do you wish for?

I already have an answer.

I propose that, instead of using GDP or overall subjective happiness, we should use occupational satisfaction as the broad indicator of economic performance. Occupational satisfaction is the core economic component of happiness. Unlike GDP, which is rooted in a materialistic understanding of value, occupational satisfaction reflects the understanding that value is subjective.

That is from two years ago.

11 thoughts on “Creating a new index

  1. That’s an idea I can support. People aren’t happy with their jobs when they aren’t getting paid much or receiving regular raises, they aren’t happy when they aren’t treated with respect, and tend not to satisfied with bullshit jobs that don’t contribute something of value to other people. And if all of those things are going well, then the country should be doing pretty well.

  2. Occupational satisfaction is the core economic component of happiness.

    1) A lot people are not working.
    2) Only a few lucky people do a job they love. I think Kevin Drum said it best do something you don’t hate.

  3. I suspect this index would have the same problem as measures of happiness do. A change in situation creates a change in expressed happiness but after a while, the person is used to it and happiness pretty much settles back to where it was before. This seems to be true for positive changes (e.g., lottery winners) and negative changes (e.g., crippling accidents).

  4. The problem with occupational satisfaction is that it quickly goes pear shaped when we discover that our compensation relative to our co-workers does not match our expectations. Ignorance is often bliss when it comes to salaries and other forms of compensation/recognition.

    Managing egos in a organization made of multi-functional teams is an important function. I wonder if ego management is not as important component of the nature of a firm as Coase’s transaction costs.

  5. No thankyou. I am staunchly Cowperthwaitean; another index is just another source of mischief. “Remarkably well-suited for social-media sharing”, forsooth.

  6. An index of the longest transaction queues.
    Straight out of PSST, how many people have to sit in fourth of fifth place in a transaction line. If we have that index then entrepreneurs go and offer a value added that shortens the line, segment the wait into specialized streams. Patterns, yes? Sustainable by reducing wait times? Specialization, finding intermediate goods that substitute well but shorten the wait?.

  7. What about the people who don’t work? Even if we ignore the unemployed, there are retirees or home-makers, or the self-employed. And of course, how do we deal with the unemployed? For example, if unemployment goes up, but the remaining workers are happier in their job overall, this survey would report it as good news, which feels wrong to me.

    I think it’s a good measure if the denominator (composition of the employed) stays constant, but I’m not sure that’s a reasonable assumption.

  8. I propose GVP, the Gross Voluntary Product, defined as GDP minus government spending. Because unlike spending by individuals or companies, the fact that a government pays for something does not mean the spending agency is getting back value equal to the amount spent (if they did, they should be willing to pay for it out of their personal pockets).

  9. An index of eusociality would be useful the divergence in human evolutionary adaptation to urban, suburban, and rural habitats. As is frequently observed, people are tending to stay put in a preferred habitat and eusociality appears highly correlated with urban habitat. By looking at the overall correlation in an area between population density, number of childless females under age 45, percent of childless males under age 45, percent of population living in housing units 3 stories or higher and the percentage of children under age 2 in daycare, would enable one to derive an index of the degree to which a local population is eusocial. The eventual split of Homo sapiens into distinct populations of more and less eusocial living arrangements will be a significant challenge economically, socially and politically. Eventually we can expect to see two distinct species much as highly eusocial termites and merely social cockroaches evolved from a common ancestor.

  10. Tyler sure is becoming a LibE – Libertarian Establishment guy, certainly not a GOPe, tho close.
    Where is Cato’s Human Freedom Index?
    https://www.cato.org/human-freedom-index-new

    Where is the Heritage Economic Freedom Index?
    https://www.heritage.org/index/ranking

    Who chooses which index to publicize? Were these two Freedom indexes publicized, along with GDP which inevitably will continue, there would be more hope to improve freedom AND economic results AND job satisfaction.

    I see the desire to have other indexes primarily as a way to obfuscate against these existing Freedom indexes, which don’t make most Dem policies or countries that follow those policies look so good.

    Freedom is good for humans.
    Freedom includes the freedom to be a bit irresponsible with your own life … and becomes problematic when the irresponsibility needs to be paid for and the irresponsible decision maker, like a dead drunk driver who killed others, can’t pay.

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