A new study sought to find out whether there was anything to the quality-of-life measurements that economists conventionally use to compare one place to another. These quality-of-life indexes are created using objective data on factors such as climate, air pollution, and tax rates. Economists have been reluctant to rely on them, though, because there hasn’t been much to indicate that they really meant anything.
That’s where the new study comes in. The study, “Objective Confirmation of Subjective Measures of Human Well-Being: Evidence from the U.S.A.,” by Andrew J. Oswald and Stephen Wu, published in Science Express on December 17, put together quality-of-life indexes of U.S. states with life-satisfaction self-rating data (that is, people were asked how satisfied they were with their lives). It found a strong correlation between quality of life, as estimated by economists, and life satisfaction from surveys. People tended to be more subjectively happy in places that had a high quality of life.
This is important as economists approach public policy questions. Economists and policymakers will now be able to rely on qualify-of-life indexes in order to attempt to craft policies that may improve the quality of life. Currently, government economic policy mainly seeks to expand the economy, without much concern for how this affects quality of life, because quality of life is considered to be unmeasurable. Now that we know that quality of life is somewhat measurable, at least as a quality of places, we can start to shift the focus of economic policy toward improving quality of life.