Measuring Well-Being: W3 Indicators to Complement GDP

20 Pages Posted: 1 Jun 2013

See all articles by Marco Giesselmann

Marco Giesselmann

German Institute for Economic Research (DIW Berlin)

Richard Hilmer

Infratest dimap

Nico A. Siegel

NFO Infratest Sozialforschung

Gert G. Wagner

German Institute for Economic Research (DIW Berlin); Berlin University of Technology; German Socio-Economic Panel Study (SOEP)

Date Written: May 30, 2013

Abstract

Numerous people in Germany, including politicians and researchers, believe that the gross domestic product (GDP) is an outdated indicator of a society’s prosperity. Therefore, at the end of 2010, the German Bundestag, the federal parliament, established a study commission (Enquete-Kommission) tasked with developing an alternative to the GDP for measuring growth, prosperity, and quality of life. This commission has now submitted a proposal: to supplement the GDP with nine additional indicators, including a wide range of factors such as the distribution of income, biodiversity, and life expectancy. The ten indicators cover three dimensions of well-being – economy, ecology, and social wealth – and hence are called W3 Indicators.

Replacing the gross domestic product by a single alternative index was rejected by the commission, however, since it is not possible to reduce citizens’ very different wishes and expectations to “a common denominator.” A representative survey of registered voters conducted by DIW Berlin and TNS Infratest shows that citizens consider the indicators proposed by the commission to be important. Respondents ranked preserving “democracy and freedom” as the most relevant indicator and “further increasing life expectancy” as the least relevant. The average per capita income – as an indicator of the gross domestic product – is the second least relevant factor as far as registered voters in Germany are concerned. However, the study also shows that opinions on the importance of different indicators vary widely. Moreover, there are systematic differences in the relevance of various policy areas for different social groups.

Keywords: GDP, GDP and beyond, quality of life, Germany, TNS Infratest, SOEP, W3 Indicators, RatSWD, well-being, QOL, bip, social indicators

JEL Classification: B59, D63, H11, I32, Z18

Suggested Citation

Giesselmann, Marco and Hilmer, Richard and Siegel, Nico A. and Wagner, Gert G., Measuring Well-Being: W3 Indicators to Complement GDP (May 30, 2013). RatSWD_WP_ 217, Available at SSRN: https://ssrn.com/abstract=2272032 or http://dx.doi.org/10.2139/ssrn.2272032

Marco Giesselmann (Contact Author)

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

Richard Hilmer

Infratest dimap ( email )

Moosdorfstrasse 7-9
Berlin, 12435
Germany

Nico A. Siegel

NFO Infratest Sozialforschung ( email )

Landsberger Str. 338
80687 München
United States

Gert G. Wagner

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany
+49 30 8 978 9290 (Phone)
+49 30 8 978 9200 (Fax)

HOME PAGE: http://www.diw.de/programme/jsp/MA.jsp?language=en&uid=gwagner

Berlin University of Technology ( email )

Straße des 17
Berlin, 10623
Germany
+30 8 978 9283 (Phone)

German Socio-Economic Panel Study (SOEP) ( email )

DIW Berlin
10108 Berlin, Berlin
Germany
+49 30 8978 9290 (Phone)
+49 30 8978 9109 (Fax)

HOME PAGE: http://www.diw/en/soep

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