Subjective Well Being and the Measurement of Social Value

On the article "Measuring Social Value" I found the next paragraph
"...most metrics assume that value is objective, and therefore
discoverable through analysis. Yet as most modern economists now agree,
value is not an objective fact."

It made think that the author was being quite harsh and unfair to social
entrepreneurs. Since the subjectivity approach is far from being widely
accepted among economists and in fact some of them are still being
"marginalized" by the mainstream economics school of thought.

In fact this approach is so new that economists haven't developed highly
sophisticated and articulated theoretical frameworks to address
subjectivity yet.

Nonetheless, some efforts have been done in recent years with very
interesting results that could be useful to measure the social value
derived from social investments.

Subjective Well Being is the name of an economic school of thought which
actually instead of making all kinds of theoretical and "scientific"
assumptions tries to deal directly with people's subjective perceptions
of value or as one review to the field states it:

"Subjective Well Being is able to capture's people actual experience in
a direct manner, while economic, social and environmental indicators do
so only indirectly"

However, what does SWB exactly means? well, the same review proposes the
next definition:

"SWB is a broad category of phenomena that includes people's emotional
responses, domain satisfactions, and global judgments of life
satisfaction"

How doest it relates to supply, demand, indicators and willingness to
pay?

Well the position of this school of thought is that consumers would know
better how their willingness to pay looks like than a bunch of math
savvy geeks with a bunch of equations, and the only way they can assess
it is by evaluating their own overall position with respect to their
aspirations and effective possibilities.

Of course this statements should be subjected to further analysis, but
maybe SWB economists and social entrepreneurs and activists could gain a
lot of insight by partnering in trying to find better ways to measure
social value.

If you want to learn more about SWB click an the link below:

http://internal.psychology.illinois.edu/~ediener/

--
Ruben Fernandez <rfernand@andrew.cmu.edu>