The Politics of Happiness: Subjective vs. Economic Measures as Measures of Social Well-Being

Abstract

Subjective measures of well-being - based on questions like "Taking things all together, how would you say things are these days: would you say you're very happy, pretty happy, or not too happy these days?" - are motivated in large part by widespread dissatisfaction with traditional economic welfare measures. An increasing number of social and behavioral scientists now argue that subjective measures of well-being should replace or complement economic welfare measures, e.g., for public policy purposes. Subjective measures differ from economic measures in multiple ways: above all, they are based on an account of individual welfare according to which welfare is a matter of mental states rather than preference satisfaction. For all their evident differences, however, I argue that traditional economic welfare measures and the now rather fashionable subjective measures of well-being have much in common. My main thesis is that economic and subjective measures - although they differ with respect to the underlying account of individual welfare - in fact are based on the very same account of social welfare: both are applications of the utilitarian social welfare function. This fact implies, inter alia, that subjective measures of social well-being are vulnerable to many of the criticisms that traditionally have been leveled against economic measures. In particular, they are open to the charge that they are indifferent to distributional concerns as well as to the charge that they neglect to take into account values like the quality of the environment, freedom, justice, fairness, rights, etc., as independent of welfare.

Keywords: Happiness, Satisfaction, Subjective Well-Being, Social Welfare

JEL Classification: B40, D63, I31