An Alternative Measure: Subjective Wellbeing

Wellbeing is about looking at ‘GDP and beyond’, which includes headline indicators in areas such as health, relationships, education and skills, our finances, the economy, the environment and individuals' assessment of their own wellbeing. Knowing how money is earned will give us some insights about the employment condition and other income elements. Also, household expenditure can give us a better understanding in the expenditure structure. To be more specific, we can use the Engel's Coefficient as an example, which as a tool for assessing household expenditure can reflect the living standard. It suggests that a lower proportion of income spent on food indicates a higher standard of living, which is important for wellbeing assessment. Moreover, a thorough investigation into the household expenditure structure also helps us to better analyze people’s behaviors and preferences.
However, measurement in income and expenditure is only about people’s financial condition. It only demonstrates people’s material wellbeing. For instance, the monetary numbers do not tell us that people in Beijing is suffering from air pollution. Looking solely at household income and expenditure does not give us any information about people’s living environment, life satisfaction, etc.
Household wellbeing is not a simple add up of all the family members’ wellbeing. Like chemicals, the household wellbeing as a whole involves more subtlety. Thus, focusing on income and expenditure is not a reasonable measure for household wellbeing. The sole use of income and expenditure as a tool is not a convincing method. To measure household wellbeing, all the aspects including health, education, happiness and personal achievement and other elements need to be taken into consideration in order to make a comprehensive assessment. In