Perceived Capabilities as an Aggregated Indicator for Well-Being

Much of the applied research on quality of life uses information on life satisfaction (or happiness) as an aggregate indicator for well-being. In this paper, we engage in an application of the capabilities approach for the measurement and interpretation of individual well-being. Specifically, we measure self-reported or perceived capabilities by asking the (Flemish) respondents "How do you consider your possibilities/opportunities in life in general?". We examine whether this kind of information is helpful for the challenge of aggregating underlying dimensions of well-being. We compare with the satisfaction with life approach and differentiate between two kinds of determinants: realisations on various life domains and personality traits. We find that perceived capabilities are more connected to realisations on life domains, while life satisfaction is more related to the personality traits. This result supports the position that information about (perceived) capabilities is a useful additional ingredient for the assessment of general or aggregated well-being.