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Putting measures of individual well-being to use for ex-ante policy evaluation

Jara, HX and Schokkaert, E (2017) 'Putting measures of individual well-being to use for ex-ante policy evaluation.' Journal of Economic Inequality. ISSN 1569-1721

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Most studies using microsimulation techniques have considered the effect of potential reforms on the income distribution. However, it has become increasingly recognized, both at the academic and political level, that focusing purely on income provides a limited picture of social progress. We illustrate how ex-ante policy evaluation can be performed in terms of richer concepts of individual well-being, such as subjective life satisfaction and equivalent incomes. Our analysis makes use of EUROMOD, the EU-wide tax-benefit microsimulation model, along with 2013 EU-SILC data for Sweden, which for the first time provides information on life satisfaction. Our results show that the effect of potential reforms varies widely depending on the well-being concept used in the evaluation. We discuss the normative questions that are raised by this finding.

Item Type: Article
Uncontrolled Keywords: Disposable income, Satisfaction, Equivalent income, Microsimulation
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Institute for Social and Economic Research
Depositing User: Elements
Date Deposited: 03 Jan 2018 16:45
Last Modified: 03 Jan 2018 16:45

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