When I set up my action, I hold the 12th fret of each string (some say the 9th) and set the saddles so that they just stop buzzing, then set the strings to match the radius of the fretboard. I tend to set the string to fretboard radius relative to the G string. After that, I hold the E string at the 1st fret and set the relief so that the string just starts to buzz then put in a slight amount so that it stops. That is my theoretical lowest possible action for a given bass. That doesn't mean it's really playable in real life situations where you are not able to pluck each string as carefully as when you have it in your lap. It's just as low as you can make it mechanically.
I generally end up raising my action somewhat for gigging. Also, I've found basses are easier to play and sound better with a medium-low action especially at the G string.
In the past, I used to take measurements an such, but I found it not to be as effective as just making the bass play well without buzz. I suppose there are other ways to set an action, but this works for me and most bassist that try out my instruments tend to comment on how easy they are to play. Having said all that, your action is as personal as your string selection. What works for one may not work for everyone.