* An extract from Issue 4 of the Newsletter on "Measuring the Progress of Societies".

[National Accounts of Well-Being]
By Saamah Abdallah, New Economics Foundation

No assessment of the progress of societies would be complete without measuring people's subjective well-being. For this reason, NEF (the new economics foundation) launched, in January 2009, the National Accounts of Well-Being. The framework devised for National Accounts is an entry point - a way to start the debate about how governments should measure people's well-being. As many organizations and academics have already recognized, it is time to move beyond purely economic indicators as markers of the success or failure of countries and policies.

Academics have been studying the measurement of what is often called 'life satisfaction' or 'happiness' since the early 1970s. Indeed, every year since 1976, levels of happiness in Europe have been measured in the Eurobarometer survey. Typically, however, these data are based on the response to a single question. It is not until recently that the science of well-being has developed to the point where more rigorous, thorough assessments of people's well-being can be attempted, that separate out different aspects of well-being, and that allow policy makers to begin to consider how their policy areas impact on well-being as a whole.

In 2007, data was released from a 50-question module, included in the European Social Survey, exclusively on personal and social well-being, and which NEF had helped design in collaboration with the University of Cambridge and four other European research centers. NEF's National Accounts of Well-Being use these data to explore the pattern of well-being in 22 European countries.

Measures can be generated and analyzed at each level of the hierarchy, using a technique involving standardization, aggregation and transformation. They allow comparisons between countries as well as within countries (e.g. between different age groups or income groups). The National Accounts of Well-Being also enables a focus on specific countries or population groups, to create Well-Being Profiles identifying areas of particularly low or high well-being. Studying these patterns should help policy makers identify where they need to focus their efforts.

With the current global economic down-turn, there is no more important time to focus on well-being. As our economic orthodoxies collapse around us, do we struggle to prop up measures, such as GDP, which are obviously telling us an incomplete story? Or do we identify what truly is important to the lives of citizens, and aim to ensure that policies produce gains measured in those terms? The National Accounts of Well-Being model provides a first, urgently needed step along the latter path.

To find out more, go to the interactive website: http://www.nationalaccountsofwell-being.org to download the report.

* For further information, please visit www.oecd.org/progress/newsletter.