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Challenges in Constructing a Survey-Based Well-Being Index

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  • Daniel J. Benjamin
  • Kristen Cooper
  • Ori Heffetz
  • Miles S. Kimball

Abstract

Many in both government and academia are showing renewed interest in developing new measures of national well-being. A new measure that goes “beyond GDP” to comprehensively capture non-market goods could be a useful supplement to traditional economic indicators for guiding policy and more accurately tracking welfare. But how should national well-being be conceptualized in theory? How could it be measured in practice? How could it be constructed in a systematic and politically neutral way? These questions should be approached by economists with the same level of care that has been taken in the theoretical and practical development of GDP. In this short paper, we focus on one conceptual framework (Benjamin, Heffetz, Kimball, and Szembrot, 2014), which uses self-reported responses to subjective well-being (SWB) and stated preference (SP) survey questions to construct an index of well-being. We briefly review the framework and highlight challenges in the first two steps a government agency would need to take before conducting the SWB and SP surveys: (1) formulating a set of aspects of well-being that is theoretically valid and can be measured accurately via surveys; and (2) choosing and interpreting the surveys’ response scales.

Suggested Citation

  • Daniel J. Benjamin & Kristen Cooper & Ori Heffetz & Miles S. Kimball, 2017. "Challenges in Constructing a Survey-Based Well-Being Index," NBER Working Papers 23111, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:23111
    Note: AG CH EFG LE LS PE POL
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    References listed on IDEAS

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    1. Fleurbaey, Marc & Blanchet, Didier, 2013. "Beyond GDP: Measuring Welfare and Assessing Sustainability," OUP Catalogue, Oxford University Press, number 9780199767199.
    2. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
    3. Angus Deaton & Arthur A. Stone, 2016. "Understanding context effects for a measure of life evaluation: how responses matter," Oxford Economic Papers, Oxford University Press, vol. 68(4), pages 861-870.
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    Cited by:

    1. Adam Okulicz-Kozaryn & Rubia R. Valente, 2019. "Livability and Subjective Well-Being Across European Cities," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 14(1), pages 197-220, March.
    2. Rosalia Castellano & Gabriella Bernardo & Gennaro Punzo, 2023. "Well-being in OECD countries: an assessment of technical and social efficiency using data envelopment analysis," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 70(2), pages 141-176, June.
    3. Clemens Hetschko & Louisa von Reumont & Ronnie Schöb, 2019. "Embedding as a pitfall for survey‐based welfare indicators: evidence from an experiment," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 182(2), pages 517-539, February.
    4. Daniel J. Benjamin & Kristen Cooper & Ori Heffetz & Miles S. Kimball & Jiannan Zhou, 2023. "Adjusting for Scale-Use Heterogeneity in Self-Reported Well-Being," NBER Working Papers 31728, National Bureau of Economic Research, Inc.
    5. Akter, Sonia & Fauzia, Talitha & Pundit, Madhavi & Schroder, Marcel, 2022. "A Gender-Specific Earthquake Recovery Assessment Using Administrative and Satellite Data: The Case of Indonesia’s 2016 Aceh Earthquake," ADB Economics Working Paper Series 674, Asian Development Bank, revised 07 Feb 2023.
    6. David Steinmayr & Doris Weichselbaumer & Rudolf Winter-Ebmer, 2020. "Gender Differences in Active Ageing: Findings from a New Individual-Level Index for European Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 151(2), pages 691-721, September.
    7. Ge, Shuang & Liu, Xielin, 2022. "The role of knowledge creation, absorption and acquisition in determining national competitive advantage," Technovation, Elsevier, vol. 112(C).
    8. Daniel J. Benjamin & Kristen Cooper & Ori Heffetz & Miles S. Kimball, 2023. "From Happiness Data to Economic Conclusions," NBER Working Papers 31727, National Bureau of Economic Research, Inc.
    9. Adi Arad & Steven Laufer & Zohar Or Sharvit & Yaniv Reingewertz & Michael Hartal, 2024. "Preference heterogeneity over the aspects of individual well-being: towards the construction of an applied well-being index," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 63(2), pages 437-468, September.

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    More about this item

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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