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Welfare and well-being

Welfare and well-being: Social value in public policy

Bill Jordan
Copyright Date: 2008
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  • Book Info
    Welfare and well-being
    Book Description:

    Research on well-being reveals the significance of personal relationships, trust and participation to sustain quality of life, yet it is the economic model that remains the dominant basis for political and social institutions and policy. In this original book, Bill Jordan presents a new analysis of well-being in terms of social value, and outlines how it could be incorporated into public policy decisions. He argues that the grandiose attempt to maximise welfare and regulate social relations through contract, in line with the economic theory of information and incentives, is counterproductive for well-being. Instead, both the quality of personal experience and the restraints necessary for a convivial collective life would be better served by a focus on cultures and institutions. This book will be an essential text for academics and students in social theory, social welfare, public policy and governance. Bill Jordan is Professor of Social Policy at Plymouth and Huddersfield Universities. He has held visiting chairs in Germany, the Netherlands, Denmark, Slovakia and Hungary. He worked for 20 years in the UK social services, and is the author of 25 books on social policy, social theory, politics and social work.

    eISBN: 978-1-84742-082-4
    Subjects: Sociology

Table of Contents

  1. Front Matter
    (pp. i-ii)
  2. Table of Contents
    (pp. iii-iii)
  3. Acknowledgements
    (pp. iv-iv)
  4. Introduction
    (pp. 1-12)

    It is both alarming and exhilarating when our fundamental assumptions about the world come under question. For most of the 20th century, the terms ‘welfare’ and ‘well–being’ were used more or less synonymously in discussions about human development, social justice and public policy (Adler and Posner, 2006; Baldock, 2007). Despite their often furious debates over the best outcomes of the interactions between its members, theorists of society seemed to share a rough consensus about the nature of the desirable rights and material resources for which these populations were striving.

    In retrospect, it is possible to recognise that this view...

  5. ONE The Easterlin paradox and the dominance of the economic model
    (pp. 13-34)

    The starting point for this book is the finding that, for at least 30 years, there has been a widening gap between average Gross Domestic Product (GDP) per head and measurements of happiness in affluent countries. This divergence was first commented on by Easterlin in 1974, but it has continued to grow ever since; as income follows an upward trajectory, ‘well–being’ (whether counted in terms of current contentment or overall satisfaction with life) remains stubbornly flat (Easterlin, 1974, 2005).

    The availability of decades of comparable individual ‘happiness data’ from countries all over the world (Veenhoven, 1989, 1999) is now...

  6. TWO Well-being and social value: ‘I shall not come to your funeral’
    (pp. 35-52)

    One of the more beguiling features of the economic model, in which distributions of welfare are related to interactions between utilitymaximising individuals, is the idea that such individuals can ultimately choose the social institutions that can give them the best possible outcomes. If they are free to make agreements with each other, both in terms of private exchanges and collective action, then they can also decide about the rules under which they will live together, and the boundaries between the individual and the collective (political) spheres.

    The appeal of this model lies in its ability to explain how people whose...

  7. Part One: Welfare

    • THREE Welfare and the economic model: ‘being precisely wrong’
      (pp. 55-72)

      It was a paradox of the last quarter of the 20th century, that the economic model of politics and public policy (with its consumerist version of value) came to overthrow all possible rivals, to the point that there ‘was no alternative’. Many critics pointed out that it abandoned ‘being vaguely right in favour of being precisely wrong’ (Sen, 1987b, p 34), and drew attention to the contradictions at the heart of its analysis of such concepts as ‘quality of life’, or ‘standard of living’. This chapter will seek to explain how (despite these) the economic model of welfare was so...

    • FOUR Social capital: the missing link?
      (pp. 73-90)

      Among the many attempts to rescue the idea of welfare from the limitations and contradictions of the economic model (see Chapter One), social capital theory has been the most influential in recent years. In this chapter, I shall focus on the first of two parts of its attempt to explain the beneficial effects of certain social contexts – that ‘social networks have value’ to those who participate in them (Helliwell and Putnam, 2005, p 438). The second part – that they benefit nonparticipants also – will be examined in Chapter Five. The purpose of this analysis is partly to show why social capital...

    • FIVE Players, members, spectators and bystanders: benefits for non-participants
      (pp. 91-108)

      The meteoric rise of social capital as a dimension of social scientific analysis can be traced to the shortcomings of the economic orthodoxy that preceded its introduction. In the model that guided public policy under strict neoliberalism and the Washington Consensus, fiscal discipline, tax reform, trade liberalisation, competitive markets, privatisation, deregulation and well–defined property rights were supposed to supply the conditions for gains in welfare by all. But the disappointments of the 1990s (including financial crises in Russia, Latin America and South–East Asia) led to modifications of that model, in which social capital found an important place (Stiglitz,...

  8. Part Two: Well-being

    • SIX Social value and well-being: paying tribute
      (pp. 111-130)

      The Easterlin paradox suggests that – especially in the Anglophone countries – societies are trapped within an economic model that fails to improve their members’ quality of life. Individuals who are free to choose private exchanges, and to create their own collective institutions, seem condemned to strive for greater economic welfare, which does not satisfy their desires. They appear to be addicted to ever-higher income and consumption, driven by the compulsion to maximise a form of utility that does not correspond to well–being – and the gap between economic welfare and satisfaction with life is growing (see Chapter One).

      In Chapter One,...

    • SEVEN How social value works
      (pp. 131-148)

      Despite the dominance of the economic model, there has been increasing interest in the idea of social value among economists themselves (Offer, 1996), and much of this has been related to the concept of well–being (Bruni and Porta, 2005). Feeding off psychological analyses of the components of subjective well–being (SWB) (Argyle, 1999; Myers, 1999), economists have investigated the interpersonal factors that correlate with high levels of self–reported happiness; a few have also addressed the mechanisms through which well–being is generated in informal interactions, even returning to Adam Smith’s (1759) accounts of ‘correspondence of sentiments’ in this...

    • EIGHT Institutions and culture
      (pp. 149-168)

      In order to explain the Easterlin paradox in terms of social value, it is necessary to show how the interactions promoted by the economic model increase welfare but not well–being. This implies that people in affluent countries act in ways that overlook opportunities to improve their quality of life. Given that the economic model itself provides cultural resources and institutions for producing a certain kind of social value, how is this possible?

      In the example given in the Introduction (pp 9-11) of the Israeli nursery (Gneezy and Rustichini, 2000), I argued that the installation of a financial penalty for...

  9. Part Three: Public policy

    • NINE Welfare economics and public policy: ‘sputtering out’
      (pp. 171-190)

      The Easterlin paradox stems from a growing gap between the economic welfare accumulated by individuals and their overall satisfaction with the quality of their lives. In liberal democracies, government policies should be responsive to the views of individual voters, so the experience that additional work effort and income for the average citizen does not produce increased well–being should lead to political debate and policy change. How does the analysis of well–being in terms of social value relate to debates about such political principles as justice, equality and liberty? How might political forces around the notion of social value...

    • TEN Social value and public policy: making citizens
      (pp. 191-218)

      Throughout this book, I have used the example of the Israeli nursery’s penalty for parental lateness (Gneezy and Rustichini, 2000) as a kind of parable for the shifts in public policy that have taken place in the Anglophone countries in the past 30 years. I am not, of course, suggesting that governments in the period after the Second World War did not follow economic principles, including elements of information and contract theory, in questions of public finance. They were, for instance, well aware of issues concerning redistribution and incentives, and the optimum taxation problem (Vickrey, 1945, pp 329–30), leading...

    • ELEVEN Justice, equality and social value
      (pp. 219-244)

      In this chapter, I shall deal with the potentially strongest objection to the proposal that social value should be a criterion for public policy decisions – that it is derived from a particular way (or ways) of life. In this view, any priority given to a substantive version of the good life, other than the many different lives freely chosen by individuals, is a violation of the principle of liberal neutrality. All the constitutional rights and protections, and the systems of distribution of resources, which make up the basic framework for interactions, should be drawn up with this principle in mind....

  10. Conclusion
    (pp. 245-250)

    This book has been both a critique of the economic model adopted by governments in the Anglophone countries, and an attempt to explain the Easterlin paradox of stalled well–being. It has argued that many of the social problems that afflict affluent societies would be better addressed in terms of social value – through building cultures of mutuality, respect and belonging.

    This might be taken to imply that the current economic orthodoxy is sustainable, if not desirable (subject, of course, to suitable modifications for ecological survival). Yet even this seems doubtful, in view of developments that were been unfolding during the...

  11. References
    (pp. 251-274)
  12. Index
    (pp. 275-284)