It is all about Shared, and Sustainable, Wellbeing

By Girol Karacaoglu

After quoting Thomas Jefferson (”The care of human life and happiness […] is the only legitimate object of good government”), Layard and O’Donnell (2015) go on to write: “What should be the goal of public policy? We agree with Thomas Jefferson. What matters is the quality of life, as people themselves experience it. And the best judge of each person’s life is that same person. Is she happy with her life; is she satisfied? In a democracy that should be the criterion for good policy” (p. 77).

Needless to say, there are numerous other possible philosophical perspectives and ethical value systems that can serve as a platform for public policy. Sen (2017) and Sen (2009) provide a survey of some of these alternatives.

I happen to agree with Thomas Jefferson’s judgement. I also agree with Layard and O’Donnell’s view that the best judge of each person’s life is that same person.

This leads one to the suggestion that the ultimate purpose of public policy is to improve the lives of people now and into the future – by enhancing their capabilities and opportunities (i.e. substantive freedoms) to pursue the lives they value, provided of course that, in doing so, they do not interfere with others’ substantive freedoms to do the same. [See, for example, Alkire (2016) and the numerous references there to Amartya Sen’s lifetime work in setting the foundations for this formulation of the role and purpose of public policy, including Sen (2009).]

The next building block is the recognition that, while people have every right to choose the kinds of lives they wish to live, there is a huge (and growing) body of empirical evidence that suggests that, irrespective of culture, history, or time, these valued lives have some common ingredients [Boarini et al (2014), Smith (2015)].

The components of the OECD’s Better Life Index (BLI), and the United Nation’s 17 Sustainable Development Goals, provide complementary lenses on these key ingredients or dimensions of wellbeing. As the OECD explains, one way to explain this complementarity, is to conceptualise the UN SDGs as the treatments prescribed by the wellbeing-doctor, to achieve the outcomes that are the key dimensions of individual wellbeing [OECD (2017)].

The components of the BLI have been categorised as quality of life (health status, work-life balance, education and skills, social connections, civic engagement and governance, environmental quality, personal security, subjective wellbeing) and material conditions (income and wealth, jobs and earnings, housing) indicators [Durand (2015)].

The links between the OECD wellbeing framework and the UN SDGs agenda are summarised in the following table from the OECD report [OECD (2017)].

How can policy help – what should policy be focusing on to ensure that people can live the kinds of lives they value, while also respecting others’ (including future generations’) rights to do the same?

Only the government, as our collective agent, can generate and deploy the resources that can create the systemic platforms for our collective wellbeing. These are represented by environmental, social, and economic ecosystems or infrastructures, as in the diagram below [Barbier and Burgess (2017)].

It is by investing, appropriately, in these ecosystems that the government can contribute towards our collective sustainable wellbeing.

The key policy question is: how should investments be prioritised? The answer, in principle is, that such prioritisation should take into account the complementarities and trade-offs between the various goals. In other words, prioritise those investments that will have the “largest bang for the buck”.

By way of example, investing in reducing poverty (in the broadest sense of that term), will be good for both the environment (because poor people cannot afford “clean products” such as electric cars), and for society (less poverty means more social cohesion), and for the economy (less poverty, through various channels including health, leads to higher productivity).

The search for such “biggest bang” investments should be the top priority for policy-informing research, under both the OECD’s Wellbeing agenda, and the UN’s Sustainable Development Goals agenda. There is now a rich and growing literature on this very agenda [Cho et al (2016)].

References

Alkire, Sabina (2016). “The Capability Approach and Well-being Measurement for Public Policy,” M. D. Adler and M. Fleurbaey (eds.): The Oxford Handbook of Well-being and Public Policy; Chapter 21, pp. 615-644; Oxford University Press.

Barbier, Edward B and Burgess, Joanne C. (2017). “The Sustainable Development Goals and the Systems Approach to Sustainability,” Economics; No 2017-28, June 08.

Boarini, Romina; Kolev, Alexandra; McGregor, Allister (2014), “Measuring well-being and progress in countries at different stages of development: Towards a more universal conceptual framework”, OECD Development Centre Working Papers, No. 325, OECD Publishing, Paris.

Cho, Jaebeum; Isgut, Alberto; Tateno, Yusuke (2016). An Analytical Framework for Identifying Optimal Pathways towards Sustainable Development. United Nations ESCAP Working Paper No. 16/03, April.

Durand, Martine (2015). “The OECD Better Life Initiative: How’s Life and the Measurement of Well-being,” Review of Income and Wealth; Vol 61, pp. 4–17.

Layard, Richard and O’Donnell, Gus (2015). “How to Make Policy when Happiness is the Goal,” in: John F Helliwell, Richard Layard and Jeffrey Sachs (eds.), World Happiness Report, pp. 76-87.

OECD (2017). Measuring Distance to the SDG Targets – an assessment of where OECD countries stand. OECD Publications, Paris.

Sen, Amartya K (2009). The Idea of Justice. The Belcknap Press.

Sen, Amartya K. (2017). Collective Choice and Social Welfare. Penguin.

Smith, Conal (2015). “Measuring Well-being: Progress to Date and Remaining Challenges”, KDI School, Sejong, OECD Presentation Slides; 24 November.

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