Well-Being: Reality and Its Perception

Abstract

This paper studies well-being in developed countries, based on both objective and subjective estimates. We look at how approaches to evaluating well-being have changed over time. Using the data from empirical cross-country research, we analyze discrepancies between subjective perception of and objective statistical data on well-being. Based on surveys conducted by the international market research organisation Ipsos MORI, the European Social Survey (ESS), the International Social Survey Programme (ISSP), etc., as well as on academic literature, our research shows the extent of how distorted individual perception of reality is, which is a novel approach to studying social well-being. Our analysis shows that individuals see various aspects of well-being differently from how those aspects are presented in objective statistics. They generally place too much emphasis on the negative aspects of their daily lives, as well as on various threats and risks, regardless of what country they live in. At the same time, they underestimate the positive aspects. The paper discusses why these discrepancies arise and what consequences they might have for society. To a large extent, this trend is related to limited individual awareness, distorted facts presented by the media, and other sources which manipulate public opinion, playing on real and imaginary issues and fears. In addition, errors in perception of well-being are largely linked to the quality of the institutional environment, equal opportunities, views on justice, etc. We have found out that highlighting negative aspects and underestimating positive ones affect life satisfaction, influence preferences, and shape reactions, as well as social, economic and political behavior. Given that individual behavior is driven by subjective views of reality, the errors in perception might lead to decline not only in individual well-being, but also in the well-being of society at large.