Income or wealth are often used to measure individual well-being because

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Income and wealth are not direct measures of individual well-being, but they are often used as proxies since they are related to utility. Utility, or the happiness and satisfaction individuals derive from consuming goods and services, is the ultimate goal of economic activity but is difficult to measure in practice. Therefore, income and wealth are considered practical indicators of well-being. However, these measures are not flawless, and other factors such as health, social connections, and personal freedom can also contribute to an individual's well-being.

Income or Wealth Are Often Used to Measure Individual Well-Being