Adjusting the social footprint methodology based on findings of subjective wellbeing research

Purpose: Following some years of practical application, some weaknesses have been identified in the original 2018 version of the ‘social footprint’ methodology, where wellbeing was seen as exclusively related to consumption activities and as inseparably linked to production through the budget constraint, implying that the value of wellbeing was limited to be a mirror of the value of production. Several improvements in both methodology and data are presented here. 

Methods: The theoretical improvements are inspired by the suggestion of Juster et al. (Rev Income Wealth 27: 1–31, 1981) that wellbeing can be seen as the sum of the value added generated from work and the intrinsic activity benefits, i.e. the positive affect from performing or taking part in specific work or leisure activities. This implies a relatively low preference for income relative to intrinsic activity benefits, which is confirmed by recent findings of subjective wellbeing research. Other findings of subjective wellbeing research provide a constraint on the conversion factor between Disability-Adjusted Life-Years (DALY) and Quality-Adjusted person-Life-Years (QALY), leading to a surprising 0.3 QALY/DALY, against the more intuitive 1 QALY/DALY. These theoretical improvements, combined with the availability of more recent country-specific data on impacts on wellbeing, allow to calculate a global potential level of wellbeing of 0.958 QALY/person-life-year, replacing the global potential productivity of the 2018 version of the ‘social footprint’ methodology. 

Results and discussion: The new country-specific data allows the valuation of impacts on wellbeing to be assessed separately from the valuation of inequality, the latter now done with equity weights relative to country-specific average income baselines, rather than to the global baseline used in the 2018 version. 

Conclusion: The new data confirm the dominating role of impacts of missing governance, now quantified at 78% of all sustainability impacts, which was the original motivation and rationale behind the 2018 version of the ‘social footprint’ methodology.