Ingebjørg Kristoffersen

The Metrics of Subjective Wellbeing: Cardinality, Neutrality and Additivity*

The use of subjective wellbeing (SWB) data in economic analysis has increased dramatically in recent years and has now become mainstream, despite some lingering concerns about the quality of these data. Although the psychology literature to a certain extent has succeeded in addressing the issues of interpersonal, intertemporal and international comparison of SWB data, the issues of cardinality, neutrality and additivity continue to be contentious among economists. This article surveys the existing literature relevant to these issues in an effort to provide clarity and thus assist SWB data users to develop more robust research designs.

Evaluating Comparability of Survey Data on Subjective Well-being

This chapter examines the problem of comparability in the context of microeconomic survey data, focussing particularly on the commonly used 0–10 numeric response scale. Most of the discussions of comparability presented in the literature concerns interpersonal (across-individual) comparability. However, the increasing availability of panel data implies a need for a discussion also of intertemporal (within-individual) comparability. This chapter provides a discussion of the nature, causes and consequences of comparability issues in subjective well-being data, and an overview of possible approaches to this problem. Finally, some worked examples and empirical evidence are presented, using Australian data. These results support the assumption that the eleven-point numeric life satisfaction scale yields scores which are ordinally distinct both across and within individuals, and that the assumption of equidistance across the scale (and therefore of cardinal comparability) seems reasonable.