Page 47 - The Importance of Common Metrics for Advacing Social Science Theory and Research

The Importance of Common Metrics for Advancing Social Science Theory and Research: A Workshop Summary
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INDICATORS 35

waves of effort to define usable indicators. However, none has succeeded
1
in defining anything remotely as widely accepted as GDP. Mulgan offered
several reasons why these methods have not been used to guide deci-
sion making, from the very nature of social science, which involves many
variables, to the difficulties of allocating value, to issues with competing
values. For example, economic analysis of the social benefits of not send-
ing someone to prison conflicts with the public’s view that punishment
has intrinsic virtue. In this case, a conceptual clash cannot be resolved by
analysis. Mulgan also believes that time horizons, used in standard com-
mercial discount rates, are often very inappropriate for valuing social and
environmental goods.
Mulgan reported that the Young Foundation has been commissioned
by the British Health Service to develop a set of tools for measuring social
value and the value of health service innovations, as part of a broader ef-
fort to try to guide public services to think about the long-term productiv-
ity of specific interventions. This method attempts to gather together in a
reasonably consistent framework, not a single metric, but elements that
are incommensurable. The process involves a consistent way of weighting
everything from quality-adjusted life years and patient satisfaction, to the
cost-effectiveness of different treatments, to the benefits for other public-
sector bodies, like municipalities, as well as the assessment of practical
implementation tools. Standardization tools are needed to compare invest-
ments in different types of activity, he observed. They are also critical to
apply in the United States and the United Kingdom, where, in the next four
or five years, the dominant public policy issue will be related to dramatic
cuts in public spending—up to 10 or 20 percent in the United Kingdom,
he said. This type of priority is forcing more attention to productivity in
public services and in the private sector. He reiterated that the use of cost-
based measures in GDP for public services is “completely ridiculous” and
actually discredits the GDP measures themselves as well as the public-sector
measures.
Mulgan summarized his major points as follows:

• There are definite benefits to standardization of some metrics ap-
plied to public policy today.
• In the context of democratic politics, there is a drive to human-
ize data to make measures better fit human experience, including

1 Tools used to standardize and synthesize complex types of social value include cost-benefit
analysis, stated preference and revealed preference methods (that draw on economics), social
return on investments, quality-adjusted life years and disability-adjusted life years, and patient-
reported outcome measures. Mulgan acknowledged that few of these are actually used to
shape decision making in the public or nonprofit sectors.

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