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Happiness in the Pursuit May 15, 2007

Posted by federalist in Social Politics.
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Happiness research is always illuminating.  Those of us who are no longer locked in a struggle for basic subsistence tend to lose our bearings and forget to think about what matters in life — what we want, what we need, and what will satisfy us.  (We also tend not to think rationally about how we should spend our excess capital, but that is a topic I’m drafting for a later date.)

Richard Voss in a letter in today’s WSJ summarizes some recent writing on the subject and makes a useful point:

What makes us happy is the pursuit itself. There is no viable, sustainable state of actually being happy. …

This leads to an important political point: We should stop worrying so much about inequality in wealth and income. So long as we have sufficient opportunity for social and economic mobility, we’re all involved in the pursuit and, thus, more or less equally happy….

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1. federalist - July 23, 2007

Arthur Brooks expounds the bizarre decisions that people make in static experiments to maximize their happiness:

The egalitarian argument against inequality starts with the claim that income is all relative: Above a basic subsistence level, they say, we care more about our financial position relative to others than about our absolute income. Experimental studies are often cited that appear to bear this idea out.

In one such study, two-thirds of subjects said that they would be happier at a company where they earned $33,000 while their colleagues earned $30,000 than at one where they earned $35,000 while their colleagues earned $38,000. In another experiment, 56% of participants chose a hypothetical job paying $50,000 per year while everyone else earned $25,000, rather than a job paying $100,000 per year while others made $200,000. Thus, the thinking goes, the very fact that some people have less than others leads to unhappiness, even without deprivation.

Moreover, the redistribution of income taxed at higher and higher levels, according to egalitarians, does not really hurt the rich, because they tend to use their “excess” incomes to purchase what they do not “need,” such as luxury cars and outlandishly large houses. Some go even further, arguing that we should tax the economically successful explicitly to discourage them from working, since their work will only make them richer and thus sadden the less successful. Says British economist Richard Layard, “If we make taxes commensurate to the damage that an individual does to others when he earns more” — the damage to others’ happiness, that is — “then he will only work harder if there is a true net benefit to society as a whole. It is efficient to discourage work effort that makes society worse off.”

But the egalitarians misinterpret the experimental evidence. The studies cited above don’t necessarily tell us that people would be happier in a world of total equality. Rather, they indicate that if there is no apparent prospect for getting ahead themselves (as there indeed was not in the experiment), people will focus instead on having more than others — even to the point of neglecting their financial interests.

There is a fundamental reason to doubt the link between economic inequality and unhappiness. If the egalitarians are right, then average happiness levels should be falling. They aren’t.

2. federalist - July 26, 2007

From the Happiness Project blog comes eight compelling ways in which money can buy you more happiness. We who have overcome the subsistence problem would do well to pay more attention to this question.

3. federalist - October 9, 2007
4. federalist - October 21, 2007

Jonathan Clements pauses to suggest why “Great wealth is overrated.” One example: When you’re eating at the best restaurant, you may realize there’s nothing better you can buy.

5. federalist - January 13, 2008

Robert Frank notes: “Previous studies have shown that when people are asked how much it takes to be rich, they always give a number that is twice their current net worth or income.”


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