Subjective well-being reflects the happiness of citizens and includes whether they believe and feel that their lives are desirable, satisfying, and rewarding. It is a key indicator of national quality of life – that is the extent circumstances in a nation are desirable – in addition to other economic and social indicators. It is important for societies to monitor subjective well-being because it reflects people’s experience of the quality of life due to desirable conditions such as good social relationships, economic prosperity, and health.
However, there is also causation in the other direction in that happy people are likely to be friendlier, healthier, more cooperative, and better citizens. Furthermore, they are more likely to be successful and productive at work, and are likely to earn more money. In other words, happiness leads to circumstances associated with a better quality of life.
Enjoy this speaker paper from Happiness & Its Causes 2013 from Professor Ed Diener.