 New approaches to measuring welfareKristen Cooper, Mark Fabian and Christian Krekel Fiscal Studies, 2023, vol. 44, issue 2, 123-135 Abstract: Economics has traditionally understood ‘welfare’ (what makes a life go well) as the satisfaction of preference. This conceptualisation of welfare is typically measured using revealed preferences, proxied through income and prices or stated in willingness‐to‐pay surveys. Recent decades have seen growing challenges to this paradigm. The climate crisis, among other phenomena, has called into question whether income and price data effectively proxy preferences, and willingness‐to‐pay surveys continue to struggle with accurately pricing important items such as biodiversity, digital goods, privacy and social connections. Preference satisfaction as a welfare criterion has also been challenged conceptually by psychologists and scholars working in the development space, among others. In this article, we review recent innovations in alternate ways of conceptualising and measuring welfare for the purposes of economic welfare analysis. We focus on using stated preferences over aspects of well‐being, life‐satisfaction scales and the WELLBY approach, and well‐being frameworks such as Bhutan's Gross National Happiness Index. While not without weaknesses, these approaches also have marked strengths relative to the traditional approach. Date: 2023 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:wly:fistud:v:44:y:2023:i:2:p:123-135 Access Statistics for this article More articles in Fiscal Studies from John Wiley & Sons |
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