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OECD Framework for Statistics on the Distribution of Household Income, Consumption and Wealth - Key Findings

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This publication presents an internationally agreed framework to support the joint analysis of micro-level statistics on household income, consumption and wealth. Its aim is to extend the existing international frameworks for measuring household income and consumption at the micro level to include wealth, and describes income, consumption and wealth as three separate but interrelated dimensions of people’s economic well-being.

The framework, prepared by an international expert group working under the auspices of the OECD, is intended to assist national statistical offices and other data producers to develop data sets at the household level that are suitable for integrated analysis, and for facilitating comparisons between countries. The Framework is widely applicable, with relevance to countries that are at different stages of statistical development, that have different statistical infrastructures, and that operate in different economic and social environments.

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OECD Framework for Statistics on the Distribution of Household Income, Consumption and Wealth - Key Findings

  1. 1. OECD FRAMEWORK FOR STATISTICS ON THE DISTRIBUTION OF HOUSEHOLD INCOME, CONSUMPTION AND WEALTH
  2. 2.  Economic well-being (people’s command over resources) is a multi- dimensional concept whose components (income, consumption and wealth) are separate but interrelated  Looking at different types of economic resources jointly (rather than in isolation) allows better identifying people in distressed or advantaged conditions, and better targeting of policies  While income, consumption and wealth are correlated at the micro- level, the correlation is far from perfect (e.g. among Australians in the bottom income decile, more than 40% had wealth above the median, and more that 25% had consumption about the median) Why an integrated view of household resources at micro-level is important? 2
  3. 3. • Recommendations by various bodies – Stiglitz-Sen-Fitoussi Commission (2009) recommended to look at income and consumption (rather than production) when evaluating economic well-being, to focus on households, and to look at the joint distribution of economic resources – Similar recommendations by a range of other bodies, e.g. 2011 Canberra Group Handbook, 17th International Conference Labour Statisticians, 2008 in-depth review of Conference European Statisticians, 2009 report of G20 Finance Minister and central banks • SNA provides framework for compilation and analysis of macro statistics for the whole economy, and are not always well-adapted to need of statistician's interested in distribution • Importance of consistency of existing statistical standards for each component of economic resources at micro-level Why has this Framework been developed? 3
  4. 4. • OECD Expert Group on Micro-Statistics on Household Income, Consumption and Wealth (EGICW) • Established under aegis of OECD Committee on Statistics (CSTAT) in late 2010 with two-year mandate • Chaired by Bob McColl (ABS, Australia), including representatives of statistical offices from 17 countries and other experts in the field (ECB, Federal Reserve Board, Eurostat, Luxembourg Income Study) • Financial and in-kind support from Federal Statistical Office of Switzerland, Australian Bureau of Statistics and Bank of Italy • Report reflects comments provided by CSTAT members; it is published on the responsibility of the OECD Secretary-General • The Framework complements the second main deliverable of EGICW, i.e. the companion report OECD Guidelines for Micro- Statistics on Household Wealth 4 Who has developed this Framework?
  5. 5. • Highlighting the importance of integrated analysis of economic resources at the household level • Outlining the main concepts used to measure economic well-being at the micro-level, and how they relate to each other • Suggesting ways of meeting the significant data requirements to undertake such integrated analysis • Encouraging countries to adapt the concepts and definitions of this framework to improve the usefulness and comparability of their micro-data • Identifying some of the conceptual and measurement issues pertaining to household economic resources that are still to be addressed and make suggestions for further international co-operation What are its key objectives? 5
  6. 6. • Ch. 1 Introduction • Ch. 2 Economic well-being • Ch. 3 Integrated framework • Ch. 4 Household income • Ch. 5 Household consumption • Ch. 6 Household wealth • Ch. 7 Integrated statistics • Ch. 8 Analytical framework • Ch. 9 Next steps • Annex A Detailed statistical framework and relationships between elements • Annex B Comparisons of micro and macro frameworks • Annex C An explanation of social assistance, pension schemes, insurance schemes, and similar concepts 6 What is the structure of this report?
  7. 7. 7 What specific guidance is provided? (1) • A conceptual framework for micro-statistics on household economic resources, mapping the relationship between its different components (page 42)
  8. 8. • Guidance on how to maximise coherence in the measurement of different types of household resources • Description of the relation and differences between the micro-framework in this report and the corresponding elements of the macro SNA-framework • Guidance to data producers on how to collect integrated micro-data, tools for combining data from multiple sources (record-linking, statistical matching), requirements for improving the quality of such estimates • Description of some of the tools to undertake joint analysis of the different types of economic resources at the micro-level (e.g. estimates of wealth enlarged income, counts of people below a multidimensional thresholds, multi-dimensional measures of central tendency and dispersions) What specific guidance is provided? (2) 8
  9. 9. Contacts: – Marco Mira d’Ercole (OECD Statistics Directorate, marco.mira@oecd.org) – Nicolas Ruiz (OECD Statistics Directorate, nicolas.ruiz@oecd.org) – Bindi Kindermann (Australian Bureau of Statistics, bindi.kindermann@abs.gov.au) For further information 9 See full report, freely available at: www.oecd.org/statistics/ICW-Framework.htm

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