The limitations of GDP as a measure of welfare are well known. We propose a new method of estimating the well-being of nations. Using gross bilateral international migration flows and a discrete choice model in which everyone in the world chooses a country in which to live, we estimate each country's overall quality of life. Our estimates, by relying on revealed preference, complement previous estimates of well-being that consider only income or a small number of factors, or rely on structural assumptions about how these factors contribute to well-being.
Bibliographical noteFunding Information:
This research has been supported by the Social Sciences and Humanities Research Council of Canada (435‐2019‐0293). We thank Thomas Holmes, Rebecca Diamond, Kyle Mangum, Holger Sieg, the anonymous referees, and participants at the Asian Real Estate Society annual conference, the North American meetings of the Urban Economics Association, the University of British Columbia, and the Summer Conference in Urban Economics and Real Estate. The views expressed in this article are solely those of the authors and do not necessarily reflect the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.
© (2021) by the Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association
All Science Journal Classification (ASJC) codes
- Economics and Econometrics