4. Implementation
Cost-Benefit Budgeting
Translating wellbeing data into actionable policy evaluation.
Gathering life satisfaction data and defining a utility curve is only the first step. For a government bureaucracy to function, these abstract concepts must be translated into standard accounting practices.
The WELLBY
To evaluate a prospective policy, decision-makers must compare its financial cost against its anticipated effect on the population's life satisfaction.
This is operationalised through the WELLBY (Wellbeing Adjusted Life Year). A single WELLBY represents a one-point change in Life Satisfaction on a 0-10 scale for one person for one year.
By assigning a monetary value to a WELLBY (e.g., the HM Treasury Green Book valuation), governments can incorporate human welfare directly into standard Cost-Benefit Analyses.
Policy Efficiency
Under this system, policies are ranked by their cost-effectiveness: their anticipated yield in WELLBYs divided by their financial cost to the public purse.
Side Note: The Value of the Invisible
This approach allows economists to price negative externalities and non-market goods that GDP ignores. A policy to reduce noise pollution or improve community social care may generate zero economic output, but will yield a highly cost-effective WELLBY return.