How do economic resources relate to individual wellbeing?
The standard of living of individuals and families is greatly determined by their command over economic resources. Having a high income or having substantial reserves of wealth extends the range, quantity and quality of goods and services that can be consumed. People with limited resources can experience hardship in meeting the basic costs of living and may become dependent on others to have such needs met. The value of income and assets held by individuals is widely seen to be an indicator of life success.
How do they relate to the wellbeing of society?
General societal wellbeing is affected by the extent to which there are people living with limited resources (in so called poverty) and by whether differences between the rich and the poor are socially palatable in terms of community attitudes about justice and equity. Feelings of social justice and equity are affected by the perceived fairness of many transactions associated with the acquisition and redistribution of economic resources, such as payments for work, government taxes, income support payments for the needy, the giving and taking that occurs within families, and of everyday business transactions.
What are some key social issues?
Ensuring that all people have an adequate income to meet the basic costs of living.
Ensuring that people are fairly remunerated for their work.
Determining the amount of financial and non-financial support that should be provided to people with limited means.
Reducing the risk of poverty by supporting sustainable human and economic development.
Organising a fair re-distribution of economic resources through government taxes and expenditures.
Ensuring people are able to accumulate sufficient resources through their working life to support themselves and their families in retirement.
What are the key definitional challenges?
Deciding which resources should be counted as economic resources in measures of economic wellbeing, such as income, consumption and wealth, can be difficult because there are many kinds of resources (tangible and intangible) which might be considered and because some resources can be difficult to value. Developing concepts and measurement scales that suitably distinguish between the rich and the poor in a way that fully accounts for their command over all goods and services remains a challenge.
What are the main measurement issues?
Most people have difficulties providing a fully itemised and completely accurate account of their income, their assets and liabilities, and their purchases, and many regard these matters as private. Imputing the value of some types of income and assets from other data sources is a means of providing more comprehensive views of economic wellbeing. Finding practical ways for obtaining reliable data which usefully describe people's economic circumstances is therefore an on-going issue of concern.