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The Journal of Socio-Economics 39 (2010) 369–375

Contents lists available at ScienceDirect

The Journal of Socio-Economics

journa l homepage: www.e lsev ier .com/ locate /soceco

reedom or happiness? Agency and subjective well-being in the capabilitypproach

urat Kotan ∗

niversity of Amsterdam, Amsterdam School of Economics, The Netherlands

r t i c l e i n f o

rticle history:eceived 2 November 2009ccepted 9 November 2009

EL classification:

a b s t r a c t

Human agency is a pivotal part of freedom and happiness. This article outlines two aspects of agency –power and control and self-establishment of goals – and situates it in the capability approach and vis avis SWB. One can view the CA as an integration of ‘agency’ and ‘outcome’ oriented approaches. Whenagency is possible, it has primacy. When not, it is valued achievements (among others SWB) that acquire

130630590

eywords:ubjective well-being

importance. Therefore agency is key for understanding how SWB fits in the general policy framework asa valued outcome. Two important functions of SWB information in this respect are outlined: as a frameof problem and as a signalling device on the effectiveness of policy.

© 2009 Elsevier Inc. All rights reserved.

gencyreedom

. Introduction

Both the subjective well-being and the capabilities approacho well-being take individuals who are the beneficiaries or theictims of policy outcomes and the workings of social structureserious. Both take an interest in how individuals are actuallyoing and their actual circumstances, as opposed to the arcanend abstract structures of ‘neo-classical welfare economics’. Theubjective well-being approach does so by investigating and prop-gating the antecedents and facilitators of positive psychologicalunctioning and human happiness and satisfaction. The capabilitypproach prioritizes human freedom: the ability and liberty to livehe life one wants to live.

These are two prominent recent approaches to well-being andmportant contenders as bases for policy thinking. Both approachesouch upon dimensions of human life and well-being that are fun-amentally important for and to individuals, and no researcherorking within one of these fields would deny the relevance foruman well-being of the concerns of researchers working in thether field. Yet Comim (2005: 162) notes: “this seemingly obvious

verlap in their object of research does not appear to be accompa-ied by any considerable acknowledgment of the vast work thatas been produced in the two fields. It is in fact quite remarkableow both CA and SWB theories seem to turn their backs on each

∗ Correspondence address.E-mail address: muratkotan@live.be.

053-5357/$ – see front matter © 2009 Elsevier Inc. All rights reserved.oi:10.1016/j.socec.2009.11.003

other’s contributions.” How are we to understand this gulf? Howmight we bring these two approaches into closer contact with oneanother?

The aim of this paper is to integrate the concerns of bothapproaches. It does so by taking agency as a focal point of departure.Once the meaning and place of agency is established, it becomesmore straightforward to see how the work done under the headingof these two approaches can inform and complement each other ina constructive way.

Section 2 sets out to determine the necessary elements of theconcept of human agency. The aim here is to present a reason-able concept of agency that is capable of sustaining consensuson the necessary elements of human agency. This working defi-nition will then be used in Section 3 to situate agency within thegeneral framework of the CA. It is argued that the CA is an inte-gration of an ‘agency’ and ‘outcome’ oriented approaches, amongthe latter is the happiness approach. Finally Section 4 establishesthe place of SWB in the CA with reference to agency. Two impor-tant functions of SWB information in this respect are outlined:as a frame of problem and a context of discovery and as a sig-nalling device on the effectiveness of policy. Section 5 concludes thearticle.

2. What is agency?

The concept of human agency involves consideration of threedistinct elements: (a) action, power and causality, (b) purposive-ness and (c) the determination of objectives.

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encing the functioning.1 In situations where control is lacking, so toagency is lacking. Whether we in this case evaluate one situationas affording greater freedom than another, depends on the pref-erences of the individual regarding the outcomes.2 Thus it should

1 Sen (1993: 43/44): “. . .Cohen [has the] . . . conviction that ‘the exercise of capa-bility’ must be a rather ‘active’ operation . . . . . . .Cohen gives examples (e.g. smallbabies being well nourished and warm as a result of the activities of their parents)that clearly show that . . . enjoying functionings . . . need not be a particularly ath-

70 M. Kotan / The Journal of Soc

.1. Action, power and causality

The first necessary element of agency or being an agent is tied upith the notions of action, power and causality. Standard dictionaryefinitions of ‘agent’ and ‘agency’ capture this aspect:

Oxford Dictionary:Agent: A person or thing that takes an active role or produces a

pecified effect.�Grammar the doer of an action.Agency: action or intervention so as to produce a particular

esult.Merriam-Websters Online Dictionary:Agent: One that acts or exerts power.Agency: The capacity, condition, or state of acting or of exerting

ower.In these definitions an agent takes action, exerts influence or

ower, and thereby causes something to happen. The ideas of actionnd power are indispensable to the concept of agency in identifyinghe source of a causal chain of events. Playing a mere role in theausal chain of events, by for example happening to be in a certainlace on a certain moment, is not sufficient to classify somethings an agent. It is by being the cause of an event through action thatxerts an influence or power that agency is established. Thus oneecessary element of being an agent or of agency is:

1. The ability to act to influence or affect the state of the world.

.2. Purposiveness and one’s goals as one’s own

The ability to influence or affect the state of the world, however,s not sufficient to characterize human agency. Another aspect ofgency, contained also in the Oxford Dictionary definition, is thatction, influence or power is directed purposefully. The inclusion ofurposiveness in the concept of agency rules out mere accidentalutcomes, and helps distinguish human agency from the agency ofon-human agents.

But purposiveness also, although a necessary aspect, is not aufficient condition to distinguish human agency from non-humangency. Consider a definition of agency in computer science:

“An agent is an encapsulated . . . system that is situated in someenvironment and that is capable of flexible, autonomous actionin that environment in order to meet its design objectives.”(Jennings, 2000: 280)

In this definition purposeful action is also a necessary conditionor a system or entity to be called an agent. Indeed an artifi-ially intelligent system is often said to act according to someurpose for which it was designed. But purposiveness in humangents means something different. An AI system cannot choosets objectives; its objectives are constructed for it by its design-rs. AI systems do determine their sub-goals, and are capable ofcting in this way. But they do not decide about their ends them-elves. Sub-goals are not ends; they are means to some other finaloal. Human individuals as agents, then, are seen as having theapacity to choose, determine or negotiate ends in a way that an AIystem cannot. Purposiveness and self-determination of one’s rea-ons for purposeful action are necessary aspects of the concept ofgency. Therefore we note as a second necessary element of humangency:

2. The ability to judge and reflect upon goals and situations ando determine one’s own goals and objectives as reasons for action.

.3. Necessary conditions for human agency

We have thus established power to act and influence the statef the world and the ability to act purposefully on the basis of one’swn objectives as necessary elements of the concept of human

nomics 39 (2010) 369–375

agency. Combining these we write down the following definitionof agency:

A human agent is a person or collection of persons having theability to exert power so as to influence the state of the world,do so in a purposeful way and in line with self established objec-tives.

3. Freedom, agency and outcome

3.1. Freedom is a mixture of agency and achievement

One of the important distinctions made within the CA is thatbetween freedom and achievement, or in other terms, betweencapability and achieved functionings. Functionings reflect in Sen’swords: “the various things a person may value doing or being.”Achieved Functionings refers to the actual occurrence of a state ofaffairs: “the particular beings or doings a person enjoys at a givenpoint in time” (Alkire, 2005: 2). Capability than refers to the: “alter-native combinations that are feasible . . . to achieve. Capability isthus a kind of freedom: the substantive freedom to achieve alter-native functioning combinations (or, less formally put, the freedomto achieve various lifestyles).” (1999: 75) Capability thus refers tothe option, the possibility, the liberty, the ability etc., or in short thefreedom, to reach a state of affairs.

Where in this conceptual scheme does agency fit? The con-ception of agency in the CA incorporates the necessary aspects ofagency outlined in Section 2. Agency in the CA literature involvesaction and active choice, or more generally the power to influencethe state of the world (e.g. Sen, 1999: 189; Sen, 1999: 190), and itrequires that the goals and objectives of an agent are his own (seefor example Sen, 1999: 12, where he contrast agency with the useof the term in the principle-agent literature). Thus an agent in Sen’swords is “someone who acts and brings about change, and whoseachievements can be judged in terms of her own values and objectives[my italics]” (Sen, 1999: 12).

This conception of agency informs the capability approachthroughout. Indeed the freedom to do and to be can be conceptual-ized wholly in terms of the level of agency one possess, were it notthough that agency considerations themselves necessitate a con-cept of freedom that includes not only the power to act on the basisof self-established goals but also to experience beings and doings thatdo not require one’s active participation in their coming about (Sen,1985: 210; 1993: 43–44). For example a crime-free environment iscounted as greater freedom compared to muggers haven taken overthe streets, even if this does not require any specific action on thepart of the individual enjoying the crime-free environment. Free-dom or capability includes both agency, which requires action andcontrol, it requires that one has the levers of control in one’s handsand that these levers can be used to generate the desired outcome;as well as achieved functionings which do not necessarily requireany activity or influence on the state of affairs by the person experi-

letic activity. I see no reason to object to this, since athleticism was never intended,despite the fact that Cohen has obviously been misled by my use of such words as‘capability’ and ‘achieving’.”

2 Freedom is thus determined by agency as well as achieved functionings. Evenwhen in Sen’s CA one is concerned with outcomes, however, the framework is stillone of respecting the person as an agent. Sen only defines outcomes as part of the

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e clear that both agency and achieved functionings are importantithin the CA. The more interesting question then is about their

pecific situation within the approach and vis-à-vis each other. Thiss answered in the next section.

.2. Agency comes first in the normative hierarchy of the CA, andutcome second

We saw above that freedom consists of agency (power & controlnd self-determination of objectives) and achieved functioningsthe actual occurrence of a state of being or doing). It readily fitsn with the spirit of the CA to reason in terms of the following hier-rchy: when agency and choice are possible, then capability andreedom understood as involving agency has primacy. When not,hen it is functionings (the valued ones) that are next in line. Seeinghe capabilities approach not only as a ‘freedom of choice’ approach,ut as an approach bound up with this hierarchy, it becomes notontradictory or problematic for the CA to admit that under spe-ific circumstances – notably where freedom of choice, or moreenerally agency, is not possible or unlikely – it is indeed outcomeshat should acquire importance as the informational base. Puttingt boldly: unless agency is impossible, too costly, unlikely etc., theres no reason within the CA to target or measure welfare in terms ofchieved functionings.

. The place of subjective well-being in policyetermination and evaluation from a freedom andapability perspective

.1. Informational limitations of SWB measures from the point ofiew of freedom

That SWB is an intrinsically important goal in people’s livesnd that it is an essential element of the good life is practicallyndisputed. SWB as a measure of well-being is in its turn often legit-

mated by reference to agency; to individuals as judges over theirwn goals and objectives in life (for example Diener et al. (1998:5, 37)). Below I elaborate on the important function that SWB haso play as a guide and signalling device in policy conception andmplementation. Here however, I point to some shortcomings ofWB as a basis for policy and evaluative analyses.

The CA literature acknowledges the importance of SWB touman life and as part of the basis for welfare evaluations, but itecognizes also that SWB is informationally too limiting for wel-are evaluations from the perspective of agency and freedom. SWBs only one part of one’s well-being and one’s well-being is only oneart of one’s overall goals (Sen, 1993).

Veenhoven (2004), however, seems to dispute the informationalimitations of SWB. He argues that SWB is an inclusive measure ofhe well-being of individuals:

“Happiness and longevity indicate how well a person’s life-bilities ‘fit’ the conditions in which that person lives, and as such,eflects more value than is found in each of the top quadrants [liv-bility of environment and life-ability of the person3] separately.

reedom/capability space because and if the individual himself is known to value thisutcome. In all examples he gives (for example Sen, 1985: 220–11) of achieved func-ionings as contributing to capability, the agency of the person is respected by optingor the outcome that he would have chosen himself if he had the possibility to chooseo do so and because of the fact that he would have chosen it himself. Although free-om consists of agency and achieved functionings, it is nevertheless agency – in itsoal/preference aspect – that determines whether an action by another party thateads to a result for a person, is increasing her freedom or not.

3 Veenhoven (2004: 4) though mistakenly equates capability with what he callsinner life-chances’ (“that is, how well we are equipped to cope with the problemsf life”).

nomics 39 (2010) 369–375 371

Happiness is a more inclusive merit than most other values, sinceit reflects an optimal combination.” (Veenhoven, 2004: 13).

There is much merit to this argument, as it rightly draws atten-tion to the ‘signalling function’ of SWB. Indeed, as will be arguedbelow, this is one of the important roles that SWB measures haveto play. But although Veenhoven shows that life-satisfaction istied up with many factors which one would regard as importantin life, this argument is insufficient nevertheless in light of free-dom and agency. In part this is because one has to distinguishthe space of information from the weights attached to elementsin that space. For example, having a body that can perform all ofits ordinary functions is important to people. In so far as SWB mea-sures are sensitive to this, the measures indeed would ‘pick up’on this information. But the in so far part of the argument is cru-cial, because it means that the importance that people attach totheir health need not show up to the same degree in SWB mea-sures. Paraplegics, for example seem on average not to experiencethe decrease in SWB that one would expect because people adapttheir goals and redirect their attentions so that self-reported SWBbounces back from its initially low level (see Kahneman and Sugden(2005). Easterlin (2004: 28/29) argues that although adaptationdoes occur, disabled people are nevertheless less happy than peoplewho are not disabled). Whether adaptation is complete or par-tial, the impact of being disabled on average self-reported SWBdoes not necessarily provide reliable information on the strengthof one’s legitimate wish not to be disabled. Similarly, Veenhoven(1993: 3) reports: “Manning-Gibbs (1972) inspected whether 20years of Black emancipation had resulted in a greater apprecia-tion of life among Black Americans. He found the reverse to be thecase”.4 And Lane (1991: 522) for example, cites a study by Abbeyand Andrews5: “Experiencing high levels of both social supportand internal control seems to be no more beneficial than experi-encing high levels of either one alone”. Again, in Lane’s example,the fact that social support and internal control seems to be nomore beneficial to subjective well-being than experiencing highlevels of either one alone, does not mean that one has no rea-son to lament the fact that one lacks one of these elements ofSWB, or that one would consider a situation in which one hadboth social support and internal control instead of only eitherof these as one in which one is equally well off. Or, in Veen-hoven’s example, that elements of ‘black emancipation’ are deemeddesirable by the individuals themselves apart from subjective well-being.

More generally, even if SWB measures pick up information onall or most of the important elements of life, information on therelative importance of goals and circumstances gets lost or trans-formed in the translation of life circumstances and abilities intoSWB. Thus although Veenhoven (1993: 9) maintains: “Happiness is. . . sufficiently sensitive for amelioration or deterioration of life”; itis not clear on which exact grounds he concludes that it is sufficientlysensitive.

In fact no single informational base is sufficient to capture the

complexities that go into the process of moral and social evaluationand of policy implementation. The merit of the CA as a frameworklies in the fact that it does not preclude any functioning, any stateof being and doing. Stemming from this, one argument in favour ofagency and freedom as the basis for welfare evaluation and policy

4 The reference from Veenhoven is to: Manning Gibbs, R.A. (1972). Relative depri-vation and self-reported happiness of blacks: 1946–1966. Unpublished doctoraldissertation, University of Texas at Austin.

5 Abbey, Antonia and Frank M. Andrews. 1986. Modelling the psychological deter-minants of Life Quality. In: Frank M. Andreas (Ed). ‘Research on the quality of life.’Ann Arbor, MI: Institute for Social Research. p. 110.

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s that it introduces less ‘distortions’ than other measures. Alkirerites:

“Income, happiness, and commodities are obviously important.he problem is that if policies aim only to increase one of these, theyay unintentionally create distortions. This is because policies are

lind to common sense adjustments. For example, if a program aimso maximize individual income, it may force indigenous people,ubsistence farmers, or stay-at-home mothers to take paying jobsecause otherwise they appear to have no income. The capabilitypproach argues that focusing on freedom is a more accurate wayo build what people really value. Focusing on freedom introducesewer distortions.” (2005: 1)

It is this multi-facettedness of its informational base togetherith the central importance of agency (defined in Section 2) in

reedom, that makes the likelihood of ‘distortions’ less. As is arguedelow this also means however that SWB needs to be taken explic-

tly into account. Both as an important state of being and because anreedom + SWB approach, that is a Capabilities approach to well-eing for policy purposes that integrates SWB considerations andata, will introduce still less distortions.

.2. The place of SWB in policy analysis

That subjective well-being is relevant for the capabilitypproach should not be an object of controversy, since as aunctioning it naturally is an element of freedom and capability.urthermore, people indicate that SWB is one of the most valuedhings in life for them.

The objective here is to determine SWB’s relative position as aunctioning vis-à-vis agency. SWB understood as a functioning (anutcome) becomes only then a candidate for the direct target ofolicy or for being the measure of well-being if there is some impos-ibility for targeting agency or where agency information is notvailable. The relevant question from a CA perspective is whetherndividuals have the freedom to opt for the means and ways of lifehat would foster their SWB.

This being said, if happiness were just another functioning thereould be no more reason to discuss it than to discuss any such other

unctioning. But it is not: people rate happiness as one of the mostmportant things in life (Veenhoven, 1993: 4). Besides this, when-ver and wherever one finds great disparities in levels of SWB (andell-being in general), one shall also find great disparities in power

nd control and the ability to act on self-determined objectives. Thiss true within nations, tribes, corporations as it is among them. Asconsequence it becomes more pertinent to explicate the ways inhich SWB is related to the CA.

.2.1. Subjective well-being as a context of discovery and framef the problem

One of Sen’s arguments against utilitarianism or happiness ashe sole base for welfare evaluations has to do with the fact thateople may and do value other things besides their own happinessnd even besides their own well-being, such as ‘saving the spot-ed owl’. I accept this as a general argument. But a lot of times thepotted owl is not the issue, and the questions at hand do pertaino the well-being and with it to the subjective well-being of indi-iduals themselves. Thus in a lot of instances subjective well-beingill be (part of) the frame of the problem. The problem will not be

n unqualified ‘freedom to achieve’, but will be ‘freedom to achieveappiness’. In this respect SWB is a frame of problem because it ishe functioning one is interested in.

Furthermore as said before, an insufficient degree or differencesn averages of SWB will on closer scrutiny prove to be explica-le (and therefore can be tackled) in terms of agency or freedom.WB-information functions here like a context of discovery, we arencouraged to delve deeper into the reasons for differences in lev-

Scheme 1. SWB as a frame of problem in the CA and as a signalling device.

els of well-being and to find differences in freedom that explainthem.

4.2.2. Subjective well-being as a signalling deviceReality is a more messy and complex business than abstract

principles, which means that distortions in the translation of prin-ciples and aims on paper into practice always occur in one way oranother. This is true for agency as it is for GDP and SWB as measuresof welfare and basis for policy. In the case of agency, the differentaspects, elements and facilitators of agency can be in quite com-plex interaction which each other. And policy, even if thought outcarefully and with the best of intentions, can have unforeseen con-sequences because of problems in implementation. Therefore thereare good reasons for maintaining an open attitude towards diversechannels and kinds of information.

SWB has a signalling function in this respect. Veenhoven (2004:13) writes on the signal function of happiness: “there are limits tomost values, too much freedom leads into anarchy, and too muchequality leads into apathy. The problem is that we do not knowwhere the optimum level lies and how optima vary in differentvalue combinations. Here again, happiness is a useful indicator. Ifmost people live long and happily, the mix is apparently livable.”

This is a strong case for happiness as an indicator of whether themix of different achieved functionings and the extent and natureof people’s real freedom is ‘livable’ or not. This case is furtherreinforced by the idea, witch enjoys considerable support withinthe SWB literature, that satisfaction with life and with particulardomains of life depends on the gap between one’s goals, needs anddesires and the attainment and fulfilment of those goals, needs anddesires (for example Easterlin, 2006: 469, for more references see:Diener, 1994). As is readily seen, satisfaction is a function of agency(or a lack of agency) in both of its aspects: the determination ofobjectives and the power and control to attain them. Behind thisis the following more general structure of argument: If SWB is thegoal in life or within a particular domain of living then failing toachieve some level of SWB or the existence of differential levels ofSWB, means a lack of volition or agency on the part of those whoare worse off in terms of SWB. Otherwise, presumably, this lack ordifference in SWB would not occur.

A capability approach that prioritizes agency, will then ask: in

what ways do people lack the ability (the agency) to obtain or bringabout the conditions of SWB under consideration, or how can (indi-vidual or collective) agency be facilitated so as to make it possiblethat people can obtain or bring about these conditions? However,when agency is not possible or cannot lead to the desired goal

M. Kotan / The Journal of Socio-Economics 39 (2010) 369–375 373

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agency can not bring about the specific condition or facilitator ofWB), than targeting SWB, or more generally functionings, directlyas to be considered. In summary, the problem then is to exam-

ne whether and how agency is hindered, whether and how agencys a possible solution, and if agency is impossible, unlikely or toocostly’ whether and how well-being or happiness can be facilitatedy other means.

Scheme 1 illustrates SWB as a frame of problem and context ofiscovery in the CA. SWB identifies the problem and the questionecomes: does the problem hint at a failure of agency, is there aay that agency can be increased to solve the problem, and if soow? If yes: aim to effect agency as a solution. If not: find what

d as a signalling device: The Whitehall study.

other means are possible and appropriate to increase SWB and tar-get those. A feedback loop feeds information on ex post SWB andfunctioning back into the problem investigation and policy settingprocess.

4.3. Policy: an illustration

One such example of differences in averages of SWB that is expli-cable (and therefore can be tackled) in terms of agency and freedomcomes from the well-known Whitehall II studies, which containfindings on the relation between job conditions and indicators ofwell-being. The study, which gathers data on the health and men-

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al well-being of 10,308 civil servants working in London, finds thatocial–economic circumstances are associated with a “range of dif-erent diseases: heart disease, some cancers, chronic lung disease,astrointestinal disease, depression, suicide, sickness absence, backain and general feelings of ill-health” and it attempts to explainhis ‘social gradient’ (Ferrie, 2004: 4) The researchers note that thisnding is quite general:

“The social gradient in health is not a phenomenon confinedto the British Civil Service. Throughout the developed world,wherever researchers have had data to investigate, they haveobserved the social gradient in health.” (Ibid.)

The Whitehall II studies do not only establish that there exists aiscrepancy in achieved functionings (doings and beings) between

ndividuals occupying different position in the social strata. Thetudies also establish that one important mechanism throughhich this discrepancy arises is ‘control on the job’ or occupational

elf-direction. Control on the job6 is found to affect mental andhysical well-being:

“The degree of control that individuals enjoy over their workecreases with lower position in the organizational hierarchy.. . Low control at work makes an important contribution to theocial gradient in mental and physical ill health.” (Ferrie, 2004: 6)nd Stansfeld et al. (1999: 305) summarize their analysis of thehitehall data as: “In summary, in this occupational cohort of mid-

le aged civil servants, demands at work increase risk, whereasecision authority and support at work protect against future psy-hiatric morbidity [my italics].” And for example Marmot et al.1997) find that employment grade is inversely associated with theisk for coronary heart disease (CHD) and that job control accountsubstantially for this association.

Thus behind the differential levels of functioning and SWBf individuals in different socio-economic strata, lie differentialevels of control and power to influence one’s job circum-tances. That is, lie differential levels of agency and freedom. Themplication of these findings is that the socio-economic orga-ization of life as a cause of ill-being and well-being requireshanges:

“These [evidences from the Whitehall II study] lead to theuncomfortable (for some) finding that inequalities in health can-not be divorced from inequalities in society. The inescapableconclusion is that to address inequalities in health it is neces-sary both to understand how social organisation affects healthand to find ways to improve the conditions in which peoplework and live.” (Ferrie, 2004: 4)

Specifically the authors trace out a number of policy implica-ions that aim to increase control: “Policy implications: 1. Improvedonditions of work could lead to a healthier work force andreater productivity. 2. Appropriate involvement in decision mak-

6 Job control (alternatively termed: decision latitude) is in the Whitehall studyade up of decision authority (the amount of control over work) and skill discretion (aeasure of job variety and opportunities for use of skills; Stansfeld et al., 1999: 303).

t is operationalized as follows: “Nine of the 15 items for job control covered decisionuthority and six covered skill discretion; these subscales were equally weighted.. . The nine items for decision authority were: Do you have a choice in deciding howou do your job? Do you have a choice in deciding what you do at work? Others takeecisions concerning my work; I have a good deal of say in decisions about work;have a say in my own work speed; my working time can be flexible; I can decidehen to take a break; I have a say in choosing with whom I work; and I have a greateal of say in planning my work environment. The six items for skill discretion wereo you have to do the same thing over and over again? Does your job provide youith a variety of interesting things? Is your job boring? Do you have the possibility

f learning new things through your work? Does your work demand a high level ofkill or expertise? Does your job require you to take the initiative?” (Bosma et al.,997: 564).

nomics 39 (2010) 369–375

ing is likely to benefit employees at all levels of the workplace 3.Redesigning practices in offices and other workplaces, to enableemployees to have greater control, benefits health. 4. Introduc-ing mechanisms for measuring and monitoring employees’ levelof control over their work provides evidence for making improve-ments in conditions of work.” (Ferrie, 2004: 7)

This example forms an illustration of SWB-data functioning asa frame of problem and context of discovery (different positions inthe occupational hierarchy correspond to different levels of well-being) being translated into a question of agency [occupationalcontrol]. At the same time, not all remedies to correct for the well-being reducing aspects of the economic space need to be tackledthrough an increase in agency.

Scheme 2 illustrates this schematically. SWB identifies a prob-lem or discrepancy and the question becomes one of finding waysto increase individuals’ power to correct for this situation or to oth-erwise provide in the facilitators of well-being under question. Asindicated in Scheme 2, the use of SWB-data (and other well-beingdata) does not stop here. Since any policy can experience inter-pretation and implementation problems, it is imperative to have acheck on policy outcomes.

An illustration of this signalling function of SWB is providedby efforts to increase employee empowerment and participationin organisations and firms. If empowerment increases people’sagency power, one expects (in the absence of adaptation) that it alsoincreases satisfaction or SWB in general. We noted earlier that SWBis bounded up with agency in both its aspects. Given desires, needs,goals objectives etc., an increase in power and control should leadto an increase in (at least domain and aspect if not life) satisfaction.‘Empowerment’ practices that fail in this respect usually will provenot to be empowering at all (in their net effects). Although SWBinformation is in itself not a substitute for information on agency,as argued earlier, findings on SWB can prompt us to delve deeperinto the determinants of agency or can give more confidence inhaving increased agency in a certain setting. This is the more impor-tant since empowerment seems to be multi-facetted and context,role and person depended. Foster-Fishman et al. (1998) underlinethat empowerment defined as “the process of gaining influenceover events and outcomes of importance to an individual or group[. . .] can mean different things to different people and vary in formacross settings and time” and that thus “the desires for, pathwaystowards, and manifestations of empowerment will vary signifi-cantly depending upon the population we target, the setting weexamine, and the point of time we witness.” (508) An empower-ment practice that raises SWB and satisfaction can be more trustedto be empowering than an empowerment practice that has a neg-ative effect on SWB.

5. Conclusion

In libertarian thought, freedom is procedural. In the CA free-dom is substantive: what can an individual actually do and be?For example the liberty of ‘freedom of speech’ is certainly part ofone’s freedom, but the capabilities framework would also acknowl-edge that if one can not read or write or if one lacks access to themedia and the means for having one’s voice heard, that there isnot much freedom of speech. So freedom of speech, for example,involves inter alia among others the freedom to enjoy education.It is this awareness that freedom is more than liberty alone, thatit requires means, processes and abilities that gives the capabili-ties approach its power. In defining development as an increase in

freedom, in the real options one has for experiencing valued doingsand beings, the CA breaks with an idea of development that seespeople in poverty as cattle that need to be feed. The same goes forsubjective well-being: by accepting and integrating the emotionaland mental experience of life in policy setting and the evaluation of

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ocial structures it potentially opens up to a more human centeredconomy.

The merit of the CA as a framework lies in the fact that it doesot preclude any functioning, any state of being and doing, andhereby not legitimizing any status quo or inequality in advance. Areedom approach that integrates subjective well-being explicitlys furthermore less likely to introduce distortions in policy for-

ulation and implementation. To put it shortly: a freedom plusappiness approach is better than either alone. The way to gobout this is to use SWB-data as a context of discovery, namely theiscovery of inequalities in options for experiencing valued doingsnd beings, the discovery of the lack of power and control to influ-nce one’s situation in line with one’s preferences. And also to useWB-data after policy implementation, as a check whether poli-ies have had the intended consequence. The idea behind whichs that an increase in the power to influence one’s circumstancesn line with self-established goals, that is an increase in agency,

ill on average increase subjective well-being. This is however notnecessity within the freedom approach, as long as the situation

s in line with whatever individuals have reason to value. Still, aecrease in SWB would signal serious negative consequences forhe freedom of individuals. Subjective well-being coupled to free-om and agency forms a powerful tool for better policy and againstalse promise.

cknowledgements

I am very grateful for the support and comments provided byohn B. Davis and the support and facilities provided by Geerteuten at the University of Amsterdam that made writing this paperossible.

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