Adding Meaning with Reference Values Trends and Targets

Indicators often are distinguished from raw data and statistics in that they are given meaning in relation to some type of reference value.10 In the simplest case of two data points, the user interprets the trend indicated as positive or negative depending on the desired outcome. A reference value may be a baseline for which the indicator measures the distance to a meaningful state, such as a background value, standard, or norm. Or it can be a threshold value for irreversibility or instability, and the indicator measures the distance to a limit or point of no return. If a reference year has been set, the indicator measures changes over time related to that year, and a benchmark indicator measures differences between countries, companies, and so on. A reference value may become an explicit soft or hard target for policy, with distance-to-target indicators measuring the dis tance to the desired target or the limit to be avoided (see also Chapter 4, this volume). All types of reference values lend meaning and importance to data and therefore contribute to the function of indicators to communicate useful information.

Reference values are broadly accepted in such fields as health care, economics, environmental quality, climate change, and education. Physicians assess a patient's health by comparing measured values (e.g., blood pressure or blood sugar level) to baseline values corresponding to his or her sex, height, weight, and age. In the quality assessment of soil, water, and air, preindustrial background values play a prominent role. For biodiversity indicators, data on the number of species or the size of an animal population are meaningless without a baseline or reference value to which they can be compared, and there are a number of alternatives in this respect (Figure 2.1). A national species richness of 30,000 or a population of 1,000 dolphins is meaningful only when compared with a baseline value. The choice of that baseline is a normative and political challenge.11

A baseline in this context is not the targeted state. When policymakers have agreed on specific targets for an issue, they become another type of reference value to which indicators can be linked, such as the Millennium Development Goals (MDGs) (for a longer discussion of targets see Chapter 4, this volume). Most indices provide only relative rankings, as in country comparisons. Only the Environmental Vulnerability Index (Pratt et al. 2004) systematically proposes indicators referenced to specific parameters of environmental sustainability.

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