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Applied and bridge studies study record
Methods & measurement

Measurement Frame Impossibility: Why Consumption-Based Welfare Accounting Cannot See the System It Destroys

STATUS · Manuscript in progressSSRN · Not yet posted
Open teaching deckSSRN — not yet postedPublication record
MECHANISM
Identify the incentive structure and the condition that would falsify the claim.
RULE CHANGE
Read the intervention only after the paper shows how the current payoff space fails to support system welfare.
READER USE
Use the summary to see where private gain creates system exposure, then check the study record.
Reading βW
βW means annual system-welfare loss divided by annual industry revenue Π. Revenue is the denominator, never profit, earnings, or net income; ΔW and Π must use the same domain, same time period, and same activity boundary. See the βW methodology manual.
Contribution — what this adds to the conversation
Provides a rigorous theorem with three axioms, nesting of existing instruments, and empirical calibration. Contributes to welfare economics, measurement theory, and the SAPM framework.
WHAT'S NEW · First formal impossibility theorem proving that consumption-based welfare measurement is structurally blind to system-welfare channels. No prior work formalizes this result.

The Measurement Frame Impossibility Theorem (MFIT) proves that consumption-based welfare accounting is structurally blind to system-welfare channels—non-priced, non-excludable effects co-generated with market transactions. Under three axioms, measured welfare can rise while true welfare falls without bound. The Case-Deaton mortality reversal (1999–2019) provides the empirical fingerprint. The theorem nests all major measurement instruments (AIDS, surveys, SWB, MPI, DINA) as projections of the bilateral frame, each inheriting the blindness. Closing the gap requires an external welfare ledger: institutional-integrity indexes, domain-specific βW estimates, and Decision Accounting records.