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Beyond GDP : Using Equivalent Incomes to Measure Well-Being in Europe

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Decancq, Koen [University of Antwerp] Schokkaert, Erik [UCL]

It has become widely accepted that focusing exclusively on income growth may lead to a too narrow-sighted measure of changes in well-being. People care about other dimensions of life, such as their health, employment, social interactions and personal safety. Moreover, an exclusive focus on income growth remains blind to the distribution of income and well-being in the society. We propose therefore a set of five principles for a richer measure of well-being. In particular, we advocate the use of a measure based on “equivalent incomes”, which satisfies these principles. We discuss and illustrate how this equivalent income approach can be implemented in Europe, using the ESS data for 2008 and 2010. We find that introducing inequality aversion and including other dimensions in the analysis leads to a remarkably different perspective on the growth of well-being in Europe

Document type Article de périodique (Journal article) – Article de recherche
Access type Accès restreint
Publication date 2016
Language Anglais
Journal information "Social Indicators Research : an international and interdisciplinary journal for quality-of-life measurement" - Vol. 126, no. 1, p. 21-55 (2016)
Peer reviewed yes
Publisher Springer Netherlands (Dordrecht)
issn 0303-8300
e-issn 1573-0921
Publication status Publié
Affiliation UCL - SSH/LIDAM/CORE - Center for operations research and econometrics
Keywords Equivalent incomes ; Europe ; Growth in well-being ; Preferences
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Bibliographic reference Decancq, Koen ; Schokkaert, Erik. Beyond GDP : Using Equivalent Incomes to Measure Well-Being in Europe. In: Social Indicators Research : an international and interdisciplinary journal for quality-of-life measurement, Vol. 126, no. 1, p. 21-55 (2016)
Permanent URL http://hdl.handle.net/2078.1/173211