Issues and Challenges in Measuring Quality of Life

Abstract

Questions have always been raised about the measurement of National Income and its use as an indicator of economic welfare. These questions were referred in 2008 by President of France to the commission on the Measurement of Economic Performance and Social Progress headed by Prof Stiglitz for their recommendations. Among many other issues, the commission did focus on a better measure of economic performance and well-being. It emphasized that it is important that measurement now shifts from economic production to people’s well-being and recommended that both level and distribution of consumption and income and not production should be the main focus of well-being evaluation and care may be taken to also include non-market activities. The commission also looked at the definition and the importance of the measurement of quality of life, which was described to be broader than the concept of economic production and well-being. They discussed different approaches and different measures of quality of life including the objective features; e.g. health, education, political voice and governance, etc. The paper argues that since the objective of calculating National income is gradually shifting from a pure measure of production to a measure of well-being; there is thus a case for inclusion of those factors in National income measurement which affect the quality of life. The paper would examine the extent to which the recommendations of Stiglitz committee related to quality of life have been incorporated by some of the selected countries. It would also try to find out the underlying issues in the measurement of quality of life and the challenges in incorporating it in National income.