Incorporating wellbeing into policy analysis

Even though you have specific objectives in your area or department, your final aim is to improve people’s lives – to maximise ‘public value’, ‘social welfare’ or ‘wellbeing’. As per the Green Book, the UK Central Government Guidance on Appraisal and Evaluation, good advice for decision-making should consider all the important impacts on people’s lives.

There is a large research literature that has identified the statistical predictors of human wellbeing and evaluations of the effectiveness of past interventions, which we can use to develop and deliver better policies.

1. Strategic level

• Defining the objective: a focus on improving people’s lives, improving wellbeing

2. Policy or project level

• Designing-in wellbeing when developing options
• Designing options which improve wellbeing, based on the evidence
• Using the wellbeing evidence to better achieve outcomes, since wellbeing in turn improves productivity, health and pro-social behaviours

3. Appraising options

Understanding and comparing the wellbeing impacts in appraisal. Supporting the estimates in social cost benefit analysis by:

• Considering the full potential impacts
• Quantifying wellbeing impacts and monetising where possible
•  Reflecting the impacts on different groups

In some cases, wellbeing will fully capture all the outcomes affected by a proposal: for example, improving social relations, or improving wellbeing in a classroom. In this case, we can consistently compare options using wellbeing as the unit of benefit, rather than translating via monetary benefits. This means that subjective wellbeing can be used as the outcome variable for Social Cost Effectiveness Analysis.