Household Wealth, Public Consumption, and Economic Well-Being in the United States

*Preliminary draft. Please do not quote or cite without permission.

Standard official measures of economic well-being are based on money income. The general consensus is that such measures are seriously flawed because they ignore several crucial determinants of well-being. We examine two such determinants–household wealth and public consumption–in the context of the United States. Our findings suggest that the level and distribution of economic well-being is substantially altered when money income is adjusted for wealth or public consumption.