Towards an optimal well-being for the Lithuanian regionsTowards an optimal well-being for the Lithuanian regions
Institute of Development Policy and Management
Faculty of Applied Economics - other
Journal of multi-criteria decision analysis. - London
18(2011), p. 7-21
University of Antwerp
The computation of regional income, being an exponent of the welfare economy, is not sufficient to measure the well-being of a regional population. Well-being goes further. In the well-being economy, each individual would have to feel good concerning material wealth, health, education, all kind of security and concerning the environment. In other words, multiple objectives have to be fulfilled. Moreover, these different multiple objectives are expressed in different units. Weights are most of the time used to equalize the different units. However, introduction of weights means also introduction of subjectivity. In order to avoid this dilemma, the internal mechanical solution of a ratio system, producing dimensionless numbers, is preferred. In addition, this outcome creates the opportunity to use a non-subjective reference point theory. The choice and importance of the objectives is also non-subjective if all stakeholders involved come to an agreement. This theory is applied on the different regions of Lithuania. A redistribution of income has to take place from the well-being Lithuanian regions to the poorer regions but under limiting conditions and for well-defined and eventually controlled projects.