Economic Well-Being in U.S. Metropolitan Statistical Areas

In recent years there has been increased interest from economists and policy makers to measure a nation’s economic well-being. This paper extends this development to US Metropolitan Statistical Areas (MSAs). An economic well-being index is constructed using indicators of income, education, crime, health and pollution. The analysis allows comparison of a MSA with another and with itself over time. The index is not highly correlated with real gross domestic product per capita and therefore adds value to the discussion of economic well-being in MSAs. However, it is shown that the index may violate social choice principles thereby reducing its usefulness.