- Series Information
- The Oxford Handbook of Well-Being and Public Policy
- List of Contributors
- Introduction
- GDP
- Cost-Benefit Analysis
- Inequality and Poverty Measures
- Social Welfare Functions
- QALY-Based Cost-Effectiveness Analysis
- Fair Allocation
- Social Ordering Functions
- Multidimensional Indicators of Inequality and Poverty
- Happiness-Based Policy Analysis
- Preference-Based Views of Well-Being
- Mental State Approaches to Well-Being
- Objective Goods
- Subjective Well-Being in Psychology
- Subjective Well-Being in Economics
- Equivalent Income
- Extended Preferences
- SWB as a Measure of Individual Well-Being
- Does the Choice of Well-Being Measure Matter Empirically?
- Does Fairness Require a Multidimensional Approach?
- The Capability Approach and Well-Being Measurement for Public Policy
- Measuring Poverty: A Proposal
- Multidimensional Poverty Indices: A Critical Assessment
- Social Evaluation under Risk and Uncertainty
- Individual Responsibility and Equality of Opportunity
- Welfare Comparisons with Heterogeneous Prices, Consumption, and Preferences
- Welfare and the Household
- Preference Inconsistency: A Psychological Perspective
- Lifetime Well-Being
- The Well-Being of Future Generations
- Author Index
- Subject Index
Abstract and Keywords
This chapter discusses and compares five measures of individual well-being, namely income, an objective composite well-being index, a measure of subjective well-being, equivalent income, and a well-being measure based on the von Neumann-Morgenstern utilities of the individuals. After examining the information requirements of these measures, the chapter illustrates their implementation using data from the German Socio-Economic Panel (SOEP) for 2010. This study finda sizable differences in the characteristics of the individuals identified as worst off according to the different well-being measures. Less than 1% of the individuals belong to the bottom decile according to all five measures. Moreover, the measures lead to considerably different well-being rankings of the individuals. These findings highlight the importance of the choice of well-being measure for policy making.
Keywords: income, composite well-being index, life satisfaction, equivalent income, von Neumann-Morgenstern utility function, worst off, Germany
Assistant Professor, University of Antwerp, Center for Social Policy
Dirk Neumann is a Post-Doctoral Fellow at the Center for Operations Research and Econometrics (CORE) at the Université catholique de Louvain and a Research Fellow at the Centre for European Economic Research (ZEW) in Mannheim
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- Series Information
- The Oxford Handbook of Well-Being and Public Policy
- List of Contributors
- Introduction
- GDP
- Cost-Benefit Analysis
- Inequality and Poverty Measures
- Social Welfare Functions
- QALY-Based Cost-Effectiveness Analysis
- Fair Allocation
- Social Ordering Functions
- Multidimensional Indicators of Inequality and Poverty
- Happiness-Based Policy Analysis
- Preference-Based Views of Well-Being
- Mental State Approaches to Well-Being
- Objective Goods
- Subjective Well-Being in Psychology
- Subjective Well-Being in Economics
- Equivalent Income
- Extended Preferences
- SWB as a Measure of Individual Well-Being
- Does the Choice of Well-Being Measure Matter Empirically?
- Does Fairness Require a Multidimensional Approach?
- The Capability Approach and Well-Being Measurement for Public Policy
- Measuring Poverty: A Proposal
- Multidimensional Poverty Indices: A Critical Assessment
- Social Evaluation under Risk and Uncertainty
- Individual Responsibility and Equality of Opportunity
- Welfare Comparisons with Heterogeneous Prices, Consumption, and Preferences
- Welfare and the Household
- Preference Inconsistency: A Psychological Perspective
- Lifetime Well-Being
- The Well-Being of Future Generations
- Author Index
- Subject Index
