To what extent does the French redistributive system reduce inequalities? What is the economic cost of climate change? To these questions that permeate the economic and political debates, the National Institute of Statistics and Economic Studies (Insee) will now try to provide some answers through “expanded” indicators and the so-called “increased” accounts. A way to give another dimension, environmental or social, to the drought in national accounts figures.
As a sign of the importance of this project for INSEE, its general director, Jean-Luc Tavernier, wanted to present the project himself during a press conference on Tuesday, November 5.
The INSEE, explained Tavernier, was based to carry out this work on the conclusions of the commission called “Stiglitz-Sen-Fitoussi”, chaired by the economist Joseph Stiglitz. Created by President Sarkozy in 2008, its mission was to lead a “Reflection on ways to escape an overly quantitative and overly accounting approach to measuring our collective performance”.
Calculation method
This innovative approach constitutes an evolution, not a revolution. “We are not seeking to build a synthetic indicator that would replace the gross domestic product (GDP)”Mr. Tavernier immediately declared. this one remains “inevitable”. “The national accounts and their emblematic indicator – GDP – are an established and recognized reference, [ils] retain all your interest, but [ils] require to be completed and [doivent] better take into account environmental and social dimensions”, the institution specifies in its press release.
For the first edition of this new generation of indicators, which will be published annually, the Institute’s experts focused in particular on “expanded” redistribution and its impact on inequalities between households. “We are not limited to the usual public lighting, that is, direct debits and cash transfers, about which INSEE has already published”Mr. Tavernier specified. This new calculation method takes into account, for example, the impact of public services on household income and living standards.
The results are then spectacular. In 2022, before redistribution, the “expanded primary income” of the richest 10% of the population was almost 24 times higher than that of the poorest 10%. But, after the implementation of these redistribution mechanisms, such as taxes, social benefits or the provision of public services, the ratio between the wealthiest and the most modest is only 3.8.
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