Measurement and public policy uses of subjective well-being

Abstract

Over the centuries happiness, or more broadly, well-being has been subject of unremitting debate. Recently, measures of so-called subjective well-being (SWB; e.g. self-reported happiness) have gained prominence and are receiving increasing attention from scientists, policy makers and the public alike. A consensus appears to be emerging that people’s selfassessment of how well life is going can convey important information, in particular on underlying emotional states. This paper introduces measures of SWB, examining whether the measures are meaningful and valid, and exploring a possible role in shaping and appraising public policy. The first part elaborates what SWB means and discusses some of the indicators used to measure the construct. Special attention is paid to the quality of different SWB measures, i.e. their reliability and validity. SWB appears to be largely defined through the specific indicators used to measure it but that is not to say that these measures are not capturing something important. In the second part, several possible uses of SWB in the making of policy are discerned: (1) SWB as an explicit policy target; (2) SWB as a complement to existing measures of well-being; (3) SWB as a measuring rod in cost-benefit analyses; and (4) the use of SWB in the construction of poverty statistics and equivalence scales. The broad conclusion that emerges is that SWB indeed can help shape and appraise public policy. This holds despite the fact that SWB research still has important gaps. What is more, future research promises to secure further the usefulness of SWB research in policy applications, not least as improvements in measurement take hold.