If we can measure what makes poor people happy, then we can improve pro-poor policies. That’s the view of the director of Oxford University’s new economics research centre, the Oxford Poverty and Human Development Institute (OPHI), which rejects the idea that income is the most significant contributor to human wellbeing. Instead attention is being turned to yardsticks that seem to have little to do with economists’ traditional concerns about production and consumption of goods and services.

Money is not the simple antidote to poverty says OPHI’s director Sabina Alkire. “We asked poor people to rank what was important to them, and income never came first,” she said. “Religion, relationships and inner peace came up as far more important than you might have imagined given standard development literature.”

The institute is working on the development of a new set of human development indicators – measuring things like empowerment, inclusion, respect and safety. They say that the ways in which these indicators are measured need to be just as robust as conventional economic indicators, because this is the only way to get them factored in to economic policies and evaluate whether the policies are working. They will be arguing for the new indicators to become a global standard for measuring economic development.

“We’re trying to add questions about dimensions of life that matter to poor people, that we haven’t asked about before.” said Dr Alkire. For instance, she explains, one important issue often overlooked by economists, is “the ability to go about without shame”. Studies revealed, for instance, that “people were humiliated when they were made to queue”. They said they felt demeaned “when your children won’t play with my children because they’re the wrong ethnicity,” or “when they are treated as if they are dirty”.

She believes that a society cannot move forward if its members live in constant fear of violence, if some people’s lives are restricted by strict class or gender roles, or if working conditions are oppressive. Well-being depends on certain ‘freedoms’ being upheld as well as on economic assets.

The institute’s emphasis on these freedoms echoes the work of Nobel Laureate economist Amartya Sen, one of OPHI’s leading advisers and whose theories of human development and capability have inspired the initiation of the Institute.

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