Measuring Well-Being

Teaser All things considered, how happy have you been these days out of 10?

Frey & Stutzer 2002 If the content of utility can be measured, then economists should consider using that content instead of the current content-free method. The content of utility, in the form of subjective well-being, can be measured. Therefore, economists should consider using that content instead of the current content-free method.

Is subjective well-being (SWB) an appropriate content for utility? Is SWB the right kind of thing to fill utility? It’s a very good fit conceptually But, it will only work if it can be objectively measured

What is the evidence for subjective well-being being measurable? Introspective Self-reports Observing behaviour Brain scans

Introspection Ask yourself how you feel about your life We may be bad at predicting what will bring us happiness but we are quite good at assessing our current emotional state and our satisfaction with our life But sometimes we are affected by biases

Self-Reports Communicating your introspection Usually by questionnaires But biases can affect the results Kahneman

Observing Behaviour Smiling (real smiles) Does away with many biases from self-reports buts adds other problems (similar to the ones with the current economic model

Brain Scans Various methods including EEG Left vs. right hemisphere brain activity More left hemisphere brain activity at ‘rest’ = positive affect More right hemisphere brain activity at ‘rest’ = negative affect Correlated with behaviour and self-reports But best fit still only about 0.2 EEG = electroencephalogram

Cute baby = Left side Note graphic pic warning for next one

Deformed baby = Right side

What are the other considerations when deciding whether to use subjective well-being as the content for utility? Practical considerations Philosophical considerations

What is the future for subjective well-being as the content for utility? Well-being can be measured but practical and philosophical considerations must be taken into account Other measures need to be taken into account