Latest from the happiness industry

Yesterday's New York Times piece on happiness, A New Measure of Well-Being From a Happy Little Kingdom, managed to bring out my inner sceptic. Andrew C. Revkin prattles on about glorious Bhutan and their happy peasants, who apparently don't mind at all being dirt poor or illiterate because it is 'Gross National Happiness' that matters (or so their King maintains).

The story also talks up the recent Second International Conference on Gross National Happiness in Nova Scotia. My earlier post GNP = Gross National Happiness? thought it seemed a quite vacuous affair, and most of the papers given tend to corroborate that view (though those by John Helliwell and Johannes Hirata are worth a look).

But the NYT story also has some great accompanying charts (attached). And read a little further down and the story perks up, highlighting the excellent work of Ronald Inglehart and his World Values Survey:

In the World Values Survey, a project under way since 1995, Ronald Inglehart, a political scientist at the University of Michigan, found that Latin American countries, for example, registered far more subjective happiness than their economic status would suggest. In contrast, countries that had experienced communist rule were unhappier than noncommunist countries with similar household incomes - even long after communism had collapsed.

"Some types of societies clearly do a much better job of enhancing their people's sense of happiness and well-being than other ones even apart from the somewhat obvious fact that it's better to be rich than to be poor," Dr. Inglehart said. Even more striking, beyond a certain threshold of wealth people appear to redefine happiness, studies suggest, focusing on their relative position in society instead of their material status.

It also highlights research by Princeton's Alan Krueger and colleagues on measuring unhappiness and subjective well-being, and developing national well-being accounts (see his recent London lecture PPT for details).

But researchers have been hard pressed to develop measuring techniques that can capture this broader concept of well-being. One approach is to study how individuals perceive the daily flow of their lives, having them keep diary-like charts reflecting how various activities, from paying bills to playing softball, make them feel.

A research team at Princeton is working with the Bureau of Labor Statistics to incorporate this kind of charting into its new "time use" survey, which began last year and is given to 4,000 Americans each month.

"The idea is to start with life as we experience it and then try to understand what helps people feel fulfilled and create conditions that generate that," said Dr. Alan B. Krueger, a Princeton economist working on the survey.

The NYT story notes that the UK government has said it aims to come up with an index of well-being, although so far this work seems much more about sustainable development than anything else.

It also cited work by Hans Messinger from Statistics Canada and Ronald Colman of GPI Atlantic on developing a Canadian index of wellbeing. Their June 2004 joint paper to the Canadian Economic Association Annual Meeting, Economic Performance and the Wellbeing of Canadians (PDF) provides more details.

While I am sceptical about the value of such measures - the methodological problems are immense - I also recognise they can be a useful means of raising awareness and encouraging debate about non-economic aspects of well-being, such as health and the environment. Happiness and well-being are topics we will be hearing a lot more about from economists and other social scientists in coming years...  (Hat tip: PSD Blog, and Azra Raza at 3 quarks daily).

Comments

[Andrew Leigh]

Interesting stuff. Three thoughts on this.
1. The relationship is almost linear when you use a log scale. We think of growth in percentage terms, so I'm bewildered as to why anyone who thought about the issue for more than 5 minutes would use a dollar scale on the X axis.
2. A paper in ReStat a few years back (http://www2.warwick.ac.uk/fac/soc/economics/research/papers/twerp615.pdf) showed that on average, within-country income growth makes people happier. Americans love just talking about America, but if you want to understand the issue, it helps to look at more than one country.
3. Much of this discussion ignores life expectancy. Even if you thought that point #2 was wrong, and that more income made us no happier, surely the positive relationship between income and life expectancy would mean that income led to more happiness over a lifetime.