Wellbeing economy monitor: December 2023 update

4. Indicator selection

Using the four capitals framework, a small number of indicators have been selected that give a sense of how Scotland is performing in terms of these different types of resources. These indicators were selected on the basis of the following criteria:

Relevance: There must be a clear relationship between the indicator and type of asset (natural, human, social or produced/financial capital). Where there are existing Scottish Government targets or commitments, aligning with them is desirable.

Validity: The indicator must measure what it is supposed to measure.

Distinctiveness: The indicator must not measure something already captured under other indicators.

Practicality: The indicator must provide value for money, and it must be feasible and affordable to obtain data. In practice, this means that most of the indicators are drawn from the National Performance Framework.

Clarity: The indicator must be straightforward to interpret.

Credibility: The indicator must be based uponimpartial, reliable datathat is precise enough to show change over time.

Comparability: There must be enough available data for the indicator to be able to draw comparisons over time, and ideally with other Wellbeing Economy Government group members^[6], who share the Scottish Government's aspiration to transition to a wellbeing economy.

The indicators are intended to give an overview or indication – they are not a comprehensive measure of the capitals. For that reason, indicators which measure a single, easily interpreted issue - for example, the gender pay gap – have been selected in preference to indices or composite indicators which may be more holistic but are more difficult to interpret and incorporate more value judgements on the relative importance of different issues.