Beyond Happiness and Satisfaction: Toward Well-Being Indices Based on Stated Preference

49 Pages Posted: 31 Jul 2012 Last revised: 20 Dec 2013

See all articles by Daniel J. Benjamin

Daniel J. Benjamin

USC, Center for Economic and Social Research (CESR); Anderson School of Management; National Bureau of Economic Research (NBER); Human Genetics Department, David Geffen School of Medicine

Ori Heffetz

Cornell University - S.C. Johnson Graduate School of Management; The Hebrew University of Jerusalem - Department of Economics and Center for Rationality; National Bureau of Economic Research (NBER)

Miles S. Kimball

University of Colorado Boulder; University of Michigan at Ann Arbor - Department of Economics; Center for Economic and Social Research, USC; National Bureau of Economic Research (NBER)

Nichole Szembrot

Trinity College

Multiple version iconThere are 2 versions of this paper

Date Written: December 12, 2013

Abstract

This paper proposes foundations and a methodology for survey-based tracking of well-being. First, we develop a theory in which utility depends on “fundamental aspects” of well-being, measurable with surveys. Second, drawing from psychologists, philosophers, and economists, we compile a comprehensive list of such aspects. Third, we demonstrate our proposed method for estimating the aspects’ relative marginal utilities — a necessary input for constructing an individual-level well-being index — by asking ~4,600 U.S. survey respondents to state their preference between pairs of aspect bundles. We estimate high relative marginal utilities not only for happiness and life satisfaction, but also for aspects related to family, health, security, values, and freedoms.

Keywords: happiness, life satisfaction, subjective well-being, stated preference, well-being index

JEL Classification: A13, D69, E01, I31

Suggested Citation

Benjamin, Daniel J. and Benjamin, Daniel J. and Heffetz, Ori and Kimball, Miles S. and Szembrot, Nichole, Beyond Happiness and Satisfaction: Toward Well-Being Indices Based on Stated Preference (December 12, 2013). American Economic Review, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2120784 or http://dx.doi.org/10.2139/ssrn.2120784

Daniel J. Benjamin

Anderson School of Management ( email )

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The Hebrew University of Jerusalem - Department of Economics and Center for Rationality

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