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Book Chapter

Publication Date



Palgrave Macmillan UK


The use of Subjective Wellbeing (SWB) measures in economics research has grown markedly (Kahneman and Krueger 2006). This has come about for at least two reasons. First, the measures have been systematically validated as reliable for examining a range of questions. Second, economists have long relied on income as a proxy for wellbeing. However, research shows that there are potentially large slippages between economic indicators and wellbeing (Diener and Seligman 2004). Thus, SWB measures have become an important alternative proxy for wellbeing. Indeed, SWB measures have also caught the attention of policy makers. The OECD launched the Better Life Index in 2011 as an alternative wellbeing measure; and the former French President Nicolas Sarkozy formed the Stiglitz Commission in 2008 to identify the limits of gross domestic product (GDP) as a measure of wellbeing and to identify alternative measures (Stiglitz, Sen, and Fitoussi 2010).

Chapter of

Inequality and Growth: Patterns and Policy

Part of

International Economic Association Series


Joseph E. Stiglitz
Kaushik Basu


Reproduced with permission of Palgrave Macmillan. This extract is taken from the author's original manuscript and has not been edited. The definitive, published, version of record is available here:

Available for download on Sunday, March 17, 2019

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