> Bhutan is trying to define national welfare
> http://www.physorg.com/news125462439.html
>
> "The main concerns have been identified as psychological well-being,
> health,
> education, good governance, living standards, community vitality and
> ecological diversity."
>
> What concerns would you include? And how would these parts of GDP+ be
> measured?

I'm glad you asked that.

I would include a component to measure self-reported satisfaction.

Now, self-reported satisfaction ("happiness") is notoriously
problematic. Good fortune doesn't make people as happy as they
predicted it would, and ill fortune doesn't make them as unhappy as
they predict. Healthy, rich people aren't that much happier. And so
on.

To counter this, I would explicitly indicate the baseline for
comparison and I would make it clear to survey respondents that
personal circumstantial well-being is what's being asked about. So
the survey question would be something like "Are you better off than
you were N years ago?" (to nearly paraphrase a certain political
slogan)

There's a dilemma lurking there: If the time interval is too large,
few people can be meaningfully surveyed (Are you better off than you
were 100 years ago?). If too small, that creates a short time
horizon.

So I'd want to ask about a range of intervals. That creates issues of
how to weight answers as a function of both N and respondent's age.


Asking only "better/worse" would result in an overly blocky metric.
That is, the system would try to make the majority just a little bit
better off, possibly at the expense of making a minority of citizens a
whole lot worse off. So I'd offer respondents a range of answers
along the usual lines of "strongly agree" ... "strongly disagree".
How to weight them is an issue here too.


Finally, there's the question of gaming the survey. If I held a long
position on GDP+, I'd be tempted to say I was better off than I really
was. I might even fool myself into believing I was.

To counter gaming the survey, I suggest incorporating Drazen Prelec's
"Bayesian Truth Serum" (BTS) - the name perhaps promises too much, but it
is a sound piece of mechanism design.

Tom Breton (Tehom)