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Why I’m not happy with a happiness index

1 August 2012


Author Bio

Emma is a Research Associate for the Growth, Poverty and Inequality Programme at ODI

A local man enjoys a watermelon, Sichuan Province, China -  John Isaac/ UN (Creative Commons licensed via Flickr)

On November 25, 2010, Prime Minister David Cameron called for the measurement of wellbeing alongside economic performance. Taking up this call, the UK’s Office of National Statistics has undertaken an in-depth investigation into the subjective wellbeing of the British population, alongside objective measures, as part of its Integrated Household Survey. Some have suggested this initiative will result in the regular release of a ‘happiness index’, though the Office of National Statistics stated that it has no such plans.

For the first time, more than 165,500 people were asked not only about matters such as their incomes, housing and employment status, but also about how they feel about their lives – their overall satisfaction, whether they felt happy and/or anxious the previous day, and whether they perceived their lives to be worthwhile. The findings were released last week, accompanied by a flurry of reporting on some surprising results and how they vary across places and among different groups. From this, we have learnt that older people and teenagers tend to be happier than other age groups, that male Londoners in their late 40s are particularly unhappy, that Arab people express more anxiety than other ethnic groups, and that residents of the Scottish isles are more satisfied than their mainland counterparts.

Many psychologists argue that such subjective questions are valuable, providing insights into people’s overall evaluation of their lives, as well as their current, more fleeting perceptions. Being satisfied is clearly important in itself – and it has long been argued that perceiving meaning in one’s life is a key ingredient of psychological wellbeing.

However, it is a big step to go from such arguments to making the claim these data ‘collectively could replace GDP as a national measure’. The lessons from recent initiatives seeking to investigate wellbeing, such as the Stiglitz-Sen-Fitoussi Commission on the Measurement of Economic Performance and Social Progress (CMEPSP) and OECD’s Better Life initiative, would seem instead to be making a somewhat different and important claim – that wellbeing has many important and non-reducible components. GDP, or more accurately, the ability to afford an adequate standard of living, clearly ranks highly, as does perceiving that one’s life is going well and has meaning. Satisfaction would appear to encompass many more dimensions of life than just GDP – but it is not clear how people arrive at their answers to a question such as “Overall, how satisfied are you with your life nowadays?”, nor how frames of reference affect such answers, nor, more profoundly, that satisfaction is the main thing to which people aspire. Consequently, it is certainly debatable that raising satisfaction ought to be the ultimate goal of people and particularly of politicians.

ODI research on Measuring Progress is addressing the important topic of what is wellbeing, how has it changed between 1990 and 2010, and how countries across the world have fared. On the basis of this research we will seek to determine where progress has occurred within and across key dimensions.

Our approach builds upon the MDG Report Card produced as part of Development Progress and several recent initiatives that have sought to define and measure wellbeing – chief among them the recommendations of the CMEPSP. We retain the general definition of progress used in the first phase of Development Progress as an “improvement in the sustainable and equitable wellbeing of a society” (Hall et al. 2010), and apply this in a multidimensional manner. 

The eight dimensions of wellbeing we consider are:

  • material living standards
  • health
  • knowledge
  • environment
  • political voice and governance
  • security
  • work
  • social cohesion

These eight dimensions have intrinsic and also instrumental value; each is important to wellbeing in its own right but also supports attainments in other dimensions.

Each dimension is represented by a small set of indicators. Data is limited so we must choose which indicators to use among those that are available, considering data quality is often poor and patchy. As previous work with cross-country data has shown, there is often little correlation among indicators of wellbeing either across or within dimensions, therefore, the choices that we make matter. To assess how countries are performing on single indicators as well as multiple dimensions of wellbeing, we will study “a large and eclectic dashboard” of indicators rather than aggregating data into a single, composite index. To measure progress over time, we look at annual rates of change for our indicators at a country level between 1990 and 2010 using four ways of measuring change: absolute change, relative change, shortfall from target and deviation from fit.  Further blogs will describe the reason for this choice of methods and begin to share the results; in coming months, we will examine how countries perform on each dimension in turn and then consider performance across multiple dimensions.

Recent initiatives aimed at measuring wellbeing have stressed the importance of subjective perceptions as adding valuable information to objective measures about what people value. Measures of happiness and satisfaction have clear intuitive appeal. However, any notion of using them to construct a ‘happiness index’ is misguided. It is important not to forget that they are one component of wellbeing only, among many others. Our aim will be to establish a more multifaceted profile of wellbeing that takes into account, to the extent possible, the many dimensions that seem to matter – for instance, having a worthwhile job, a decent education, and living in a safe environment – as well as how people feel.