Table of Contents

The Elgar Companion to Recent Economic Methodology

The Elgar Companion to Recent Economic Methodology

Edited by John B. Davis and D. Wade Hands

Bringing together a collection of leading contributors to this new methodological thinking, the authors explain how it differs from the past and point towards further concerns and future issues. The recent research programs explored include behavioral and experimental economics, neuroeconomics, new welfare theory, happiness and subjective well-being research, geographical economics, complexity and computational economics, agent-based modeling, evolutionary thinking, macroeconomics and Keynesianism after the crisis, and new thinking about the status of the economics profession and the role of the media in economics.

Chapter 6: Current Trends in Welfare Measurement

Erik Angner

Subjects: economics and finance, behavioural and experimental economics, methodology of economics

Extract

Erik Angner1 6.1 INTRODUCTION Welfare or well-being – I will use the terms interchangeably – is ‘what we have when our lives are going well for us, when we are living lives that are not necessarily morally good, but good for us’ (Tiberius, 2006, p. 493). Because the concept of well-being is frequently assumed to capture what is – ultimately and not just instrumentally – good for individuals and for groups, it is also supposed to capture that which we have reason to promote – as an end and not just as a means – in our own lives and in the lives of others (Scanlon, 2000, pp. 108–9). Hence, it is widely assumed that well-being is one (or the one) consideration that should serve as an end – and not just a means – for public policy. ‘A full consideration of taxes, subsidies, transfer programs, health care reform, regulation, environmental policy, the social security system and educational reform’, Daniel T. Slesnick writes, ‘must ultimately address the question of how these policies affect the well-being of individuals’ (Slesnick, 1998, p. 2108). Given the importance of the concept of welfare, it is unsurprising that the measurement of welfare should be a central concern of modern economics – both theoretical and applied – and of public policy analysis (Slesnick, 1998, p. 2108). To develop a working definition of ‘measurement’, I will follow David H. Krantz, R. Duncan Luce, Patrick Suppes, and Amos Tversky: ‘When measuring some attribute of a class of objects or events, we associate numbers (or other familiar mathematical...

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