1. MEASUREMENTS

what is happiness economics

new field on how happiness relates to economic variables

what is happiness

no common definition

used differently in everyday language

used inconsistently

history of happiness

• ancient greek- hedonism- quality of life is by amount of pleasure and pain experienced

• Aristotle- happiness as good spirit, relates to virtue theory and niochemanic ethics, ethics is rooted in the concept of happiness

• bentham and mill- utilitarianism, and moral calculus, utility measuring pleasure and pain, their felcific calculus measured by money

• edgeworth- utility measured cardinally

• 20th c- now we saw we cannot measure it cardinally

• now- no longer a direct synonym for happiness, but it is often the extent to which peoples preferences are satisfied

eudamonia

from Aristotle,about human flourishing wellbeing or living a fulfilling life unlike hedonic happiness which is about meaning purpose and personal growth

what to use

20th c say utility is rationality but people have different objectives eg rationality in food choices fail to hold

in laissez fair approach, each persons freedom is to maximise their own utility function, people arent rational therefor we need policy

do people aim to maximise happiness

medvec et al: bronze medallists appear happier then silver medalists

benjamin et al: when peoples choices deviate from SWB maximisation this is deliberative not random errors eg trading own happiness for families

typology of measuring wellbeing

donal et al 2006; typology of 6 accounts of wellbeing

1. preference satisfaction: freedom to meet ones wants and desires

2. objective lists and basic needs: fulfilment of fixed set of needs

3. eudaimonic: realisation of ones potential

4. hedonic: positive effect balance relative to moods and feelings

5. cognitive; individuals own assessment of their life

happiness economics uses SWB and neoclassical looks at preference satisfactions

both say others cant judge your own happiness

preference satisfaction approach

comes from dissatisfaction from hedonistic and utilitarianism ideas

doesnt allow for happiness comparisons

focuses on if peoples preferences choices or desires are met in their life rather then measuring happiness directly

swb approach

by easterlin and leydon

happiness is a real experience that can be measured and analysed directly

happiness is influenced by factors h=H(x)

people report happiness r based on experience; r=R(h)

this needs consistent reporting and idea that we can express this mathematically, this can be measured using different approaches

depends on how people interpret the question leading to misunderstanding or cultural and linguistic differences eg south america report higher swb then communist countries, in french happiness has a deeper meaning then in english

happiness can be measured on a single scale- your 5 maybe different to mine

swb critisisms

not fully accepted by mainstream economists

• epistemological- happiness is unmeasureable

• practical- biases when used as a dependant variable

• disciplinary- doesnt fit with economists

factors influencing happiness

• absolute income

• past and relative income.. easterlin paradox- national happiness doesnt rise with GDP over time but can be explained by income habituation and rivalry

• personal and demographic factors

• work and time use

• attitudes and beleifes

• economics and politics

• enviornment

• sense of purpose

• control over life

• family happiness

• social status

happiness impact on health

danner et al 2001 in 1930 measured happiness of nuns from their writing in 20s happy nuns live 10 years longer then unhappy ones from 7-10 years more

cohen et al 2003 measured happiness of experimental participants when injected with the common cold happier participants were less likely to get ill and recover faster

schenedire et al 2009

moderate level of agreement between how people rate their own wellbeing and how others perceive their wellbing

those with high extraversion and low neuroticisms others and theselves rate them as happy

blanch flower et al 2008

high blood pressure report lower happiness- is the psychological or social more then happiness