Sabbatical

Hello! Welcome to For A State of Happiness. I hope you’ll enjoy the blog.

From 2013 to 2016, I’ve written weekly blog posts on topics around happiness. I’ve started a sabbatical now, and my blog posts are on hold. I explain the reason for my break from blogging in this post. In short: TL;DR boils down to the notion that the world may not be ready for the ‘beyond GDP’ agenda yet, and I’ll give myself some breathing space before I move on.

For the moment, I’m spending time on reading happy books and devising new plans to make the world a happier place.

That doesn’t mean that there is nothing to do here, though. In the last years, I’ve written a lot about happiness from three angles: personal happiness, happiness at work, and happiness at the level of the state and our society. If you browse the categories and tags on the right, or check the indices (season 2013-14, 2014-15, 2015-16), you’ll be able to find a lot of interesting pieces. My highlights? Learning all on Gross National Happiness in Bhutan and speaking at the Wellbeing Forum in Mexico.

I am still available for doing talks, presentations and workshops on happiness (see some previous ones here, here and here), so do contact me if you are interested. Or if you like my work and want to get a coffee, feel free to get in touch via jasper [@] forastateofhappiness [dot] com!

Enjoy your exploration and the pursuit of happiness!

Index: For A State of Happiness, season 2015-2016

For A State of Happiness is on off-season now, but just like with TV series, you can always watch back your favourite episodes.

See below the index of the posts of season 3, 2015-2016.

September

October

November

December

January

February

March

April

May

June

July

A world beyond GDP: are we ready yet?

On the road to discover how happiness works, I learned a lot about happiness in my own personal life – and in your personal lives, too. I’ve also gained a lot of insight in happiness at work. But the main focus of my research effort has been around another question: is there something our governments can do to make us happy?

Allow me to dwell on this question today, before I start my ‘sabbatical’ as a blogger.

I am sure that governments can make us happier, and that they should aim to do so. There are many governments that are taking happiness-based data into account when setting policies. Gross National Happiness (GNH) in Bhutan is more of philosophical guide than a hands-on policy tool, but it shapes the narrative of the government’s action. Regions in the EU and elsewhere learn from the OECD Better Life Index and Regional Well-Being Index and from Social Progress Index (SPI). And on the local level, there is an uncountable number of projects where municipalities and social society players take happiness as inspiration in social, environmental and other projects.

 

GDP, an increasingly poor measure of prosperity

On one of the bigger and more abstract questions I have countered on the road is whether our data helps us to work on happiness. I’ve time and again argued that Gross Domestic Product (GDP) has plenty of limitations. Instead, I assessed the virtue of alternative indicators mentioned above. And I have been far from alone in this endeavour. Back in 1968, Robert F. Kennedy already decried that GDP measures everything, except that which makes life worthwhile. In the last ten years, the debate on ‘beyond GDP’ has been particularly fierce. A cover article of the Economist some months ago summarised these limitations very well, and labelled GDP “an increasingly poor measure of prosperity”.

Can we do without GDP? Does the acceptance of the constraints of GDP mean that a real competitor has risen to the stage? Did we get anywhere in those ten years?

After three years of researching, I fear that my answers: no, we cannot yet do without . No, there is no real competitor. And no, maybe we haven’t made as much progress as we like to think. In the remainder of this post, I explain why.

Kennedy GDP

 

Can we do without GDP?

Ever since its creation in the 1930s, GDP provides important information about national accounts and the size of the economy. It simply measures all production that has been created in a certain territory in a year. These data are important to inform decisions on investment, government spending, and taxation. But all too often, GDP becomes a proxy for progress or prosperity. As a tool, it only measures part of productive economy: GDP falls when a man marries his maid. Indeed, if they don’t increase the economy, GDP discounts social and environmentally desirable activities, such as household work.

Furthermore, GDP is an artificial number. Figures are routinely revised, often upwards and by large margins. After a new method is used in Ireland, GDP growth is not an already significant 7.6% over 2015, but a whopping 26% as a result of some accounting tricks. Imagine the consequences: in terms GDP per capita, Irish are suddenly a lot richer, and the budget deficit shrinks by the stroke of a pen!

Despite all these limitations, GDP is probably a bit like democracy. In Churchill’s words, democracy is the worst form of government, except for all the others. We still need GDP as a tool to measure economic activity, to make sense of poverty, and to determine how much tax we need to pay to run our common society. It might still be the best we can do?

 

Is there any competition?

Or can we? In this blog, I’ve covered many alternative indicators, from GNH to the OECD Better Life Index to the SPI, but also the UN’s Humanitarian Development Index and even the Happy Planet Index. In my view, these are good as part of driving the narrative for a broader sense of well-being and progress. Tools like the OECD Better Life Index, GNH and the SPI can be helpful in spotting where governments need to focus resources to increase quality of life.

But they aren’t appropriate for all economic purposes. All indicators have a stronger element of arbitrary and political choices. As such, they’re too political to be used in a more economic context. Countries simply would refuse to determine financial contributions to the United Nations based on performance in the HDI, or EU regional funds based on a regional SPI score. GDP too often is seen as the more ‘objective’ metric, and even though it is not objective or stable, it is doing better than alternatives. Intriguingly, GDP is also strongly correlated with performance like HDI and SPI, even around 80% for the latter index. Although the SPI is making advances in feeding into policy, altogether none of the indices is truly challenging the position of GDP as things stand in 2016. And I don’t think it will be very different in 2018, 2020, or 2025 for that matter.

 

Did we make so much progress?

Then, how much progress did we make in several decades of an academic debate, and overall ten years of statistical revolution? A lot has happened. Our insights in quality of life and happiness is a deeper than at any moment in history. OECD statistical offices are now routinely gathering data on subjective wellbeing, and there is a vibrant research agenda in positive psychology and related fields. Academics and practicioners, myself included, happily travel to Bhutan to learn about GNH.

But what was generated out of this debate? Are we paying more attention to quality of life after the financial crisis? A single indicator truly competing with GDP has not been born. UN and EU authorities, as well as national governments and parliaments, have underlined the importance of alternative ways of measuring progress. But the reign of GDP has never been in danger. My feeling is that GDP is simply too important, and the alternatives too complex. I fear that we’re not ready for this revolution yet.

 

Time for a sabbatical

Three years on the road, my doubts on the alternatives to GDP are back. I see the beyond GDP agenda as a powerful discussion, but one that has not generated a strong enough alternative to truly challenge GDP.

On a personal level, this means that a reflection on my work is needed. Do I need to focus on something else? Do I need to work harder, or differently, for a state of happiness? Did I fail myself?

For the moment, I’ll take a break from this blog. I’ll reflect on other steps. I deserve to take some time off for a sabbatical to read more and generate other ideas. But I am sure I’ll be back with a new programme.

Because a life, enjoyably wasted in the pursuit of happiness, is a life worth wasting. Farewell!

The Social Progress Index: is your region better than its peers?

One of the common themes in my explorations on this blog has been in ‘alternative indicators’, or tools that are better equipped to measure quality of life than Gross Domestic Product (GDP). One of the most prominent ‘beyond GDP’ tools is the Social Progress Index, which I labelled “a better way to measure a good society”. And the SPI has seen a lot of development since my post of last year.

Let me start with a recap: the Social Progress Index (SPI) is developed as a broader notion of progress than GDP. It consists of 53 indicators, under the headings ‘basic human needs’ (shelter, access to clean water), ‘foundations of well-being (health, internet access) and ‘opportunity’ (human rights, social tolerance). Typically, countries tend to score higher on  basic human needs, as these often are met in high and middle income countries, even if they don’t meet the same standards on the social issues. Roughly speaking, performance for opportunity is lower, even in the richest countries. The exercise has been conducted for a couple of years now. In the 2016 update released this June, the list is topped by Finland, Canada and Denmark.

Better than your peers?

The aim of the index is similar to other beyond GDP tools I discussed like the OECD’s Better Live Index. Namely, to identify the areas of ‘progress’ or well-being in which a country is doing well, and those where it is underperforming peers. The concept of peer group is an important facet: the strengths and weaknesses are listed in comparison to a 15-country group of peers with similar levels of GDP.

This type of screening tool, in theory, could be used to help countries identify in which policy areas they could invest. The thought is that by learning from over-performing peers’ best practices, countries can use their limited resources in the most efficient way, namely by generating the highest additional well-being. The SPI has expanded a lot in the last year, starting projects with the US State of Minnesota, Reykjavik, Iceland, in the capital Bogota, other cities in Colombia and elsewhere in Latin America.

This is how the world is doing in social progress in 2016 (darker shades means higher SPI score). Source: SPI

This is how the world is doing in social progress in 2016 (darker shades means higher SPI score; grey means no data). Source: SPI

Digging down to regional level

In practice, indeed, the differences within countries are more important than between countries. More granular data at the regional and local indeed provides a lot more hands-on information to policy makers on where, and how exactly, they can do better. And the Brussels capital region may be better compared to another large city, like Hamburg, then to the province of Belgian Limburg, which in turn could learn more from a region of similar GDP as East Anglia.

That’s why both the OECD and the SPI have been complemented with data on regional level. In 2016, the SPI launched a pilot overview of the 272 regions in the EU. The Commission has released the data of the exercise in February, and an updated version is due to come out in October. And where OECD uses only 11 indicators, the European regional data provide 50 out of the original 53 of the SPI. They also built in the peer group comparison in the methodology.

Once we start comparing regions with each other in Europe, very quickly the next question comes: will the unprivileged regions get more money to bridge gap?Conceptually, one could argue that using the SPI data to address specific low performance areas is a good way to aiming investment at the area where progress can be made. But money is sensitive, and in presenting the data, the Commission has been crystal clear that it doesn’t want to revise this funding policy. Nonetheless, the granular data can provide what is necessary: a better way to measure a good, regional, society.

How is Brussels doing? A bit of under-performance compared to Hamburg, Prague, Vienna, and similar regions. Source: European Commission/Social Progress Imperative

How is Brussels doing? A bit of under-performance compared to Hamburg, Prague, Vienna, and similar regions. Source: European Commission/Social Progress Imperative

Summer, time of darkness

Happiness is always a good thing, right? At least, all over my life I’ve assumed that happiness is something pretty and beautiful, and always worth pursuing for its own sake.

A recent TEDx talk by Meik Wiking of the Danish Happiness Research Institute has opened my eyes. Everything in life has a dark side, and that even applies to happiness.

800,000 suicides per year

Wiking starts his talk on The Dark Side of Happiness by pointing out that around 500 Danes commit suicide every year, although they live in the country that tops the World Happiness Report as happiest country of the world. Some people think that suicide rates are particularly high in Nordic countries like Sweden, Finland and Denmark, with long and dark winters (sometimes it is even thought that happiness rates remain high, because unhappy people filter themselves out by suicide!).

This is not the case, and many countries in Eastern Europe and across the East of Africa rank worse, as the WHO data show. To some extent, suicide rates might be affected by cultural factors, such as the high pressure to perform and strong shame notions in Korea and Japan. Lower levels in a country like Mexico may also be a result of strong social support. Either way, every year around 800,000 commit suicide. That figure is massive, especially when you consider that the death toll of one the most bloody conflicts and biggest human tragedies always in our headlines, the Syrian civil war, is estimated at around 400,000 in the last five years.

 

Suicide rates per 100,000 citizens. Data: World Health Organisation, 2016

Suicide rates per 100,000 citizens. Data: World Health Organisation, 2016

 

Social positions matter… a lot! 

But is there any correlation between happiness levels in society and the suicide? Wiking suggests that there could be a link. He claims that it is more difficult to be unhappy in a happy society. Imagine that Stine is unemployed and that she has had trouble in finding a job for some months. At the same time, most of her friends have great jobs, and excitedly tell her about their promotions or new cool projects when they meet for drinks together. Sounds sad, right? Now imagine the case of Jaime. He has also been looking for a job some time, but some of his friends are in the same boat. When they meet up, they exchange funny stories about failed job applications, or  share tips on how to land a dream job.

All things equal, Jaime will likely be happier than Stine. Our peer group, and the people who we compare to, matter for how we feel. Hence, it’s tougher to be unhappy in a country like Denmark, which scores a 7.526 in the World Happiness Report, than say in Spain, which scores 6.361. Our social position counts!

Wiking shares a couple of interesting experiments that reinforce that feeling. For instance, tests with social media show that when people are not exposed to other people’s seemingly perfect online lives for a week, happiness rates go up. Similarly, imagine asking hundred people if they’d rather earn €50,000 when everybody else earns half that amount, or €100,00 when everybody earns double. Typically, around 50% would prefer to earn less in absolute terms, but be richer than others.

Summer, a time of darkness

But one of the most shocking pieces of evidence are the quotes from depressed people. Contrasting what you might think, it is not Christmas that is the most difficult of the time for lonely people. In the survey that Wiking cites, spring and summer are worse: “Summer is a nightmare.” Everybody is sitting in parks, holding picknicks and barbecues with friends. For lonely people, this is the hardest time of the year. Other’s people happiness can generate a lot of unhappiness. And the impact of loneliness or happiness inequality is likely a lot bigger than the economic inequality.

Happiness also has a dark side, and summer may be a time of darkness. That truth is worth taking into account when we are thinking about happiness and public policies shaping quality of life.

The Netherlands’ first step to a happiness machine

In the three years I’ve been writing this blog, I’ve travelled around the world to explore happiness: from Denmark to Mexico and Bhutan, and from Costa Rica to the United States (well, the latter two only in spirit). But so far, I never wrote about my own home country, the Netherlands.

That’s not because there is no interesting debate on happiness in the Netherlands. The Netherlands always scores high in the international rankings (seventh in this year’s World Happiness Report, and fifth last year). It is home to the first Happiness Professor, Ruut Veenhoven. He was one of the first academics to seriously study happiness and his university hosts the World Database of Happiness (I’ve been told their team has identified 963 ways that have been used to measure happiness). A Unicef report often quoted in press demonstrates that Dutch children are the happiest ones of the (rich and developed) world. And beyond that, I’ve come across a lot of great projects on happiness, from happiness budgets for socially deprived people to happiness trainers and from happiness in civil community work to activists for environmentally sustainable happiness. The Dutch appear to be a happy few!

Happy people, happy state?

But does all this manifested interest mean in academia and society mean that also the national government is interested in understanding and enhancing the happiness level of its population? That is not the case. Prime Minister Mark Rutte famously stated that:

The State is not a happiness machine

What does Rutte mean by this? From the 1960s to the 1980s or even longer, many  in the Dutch political elite believed in the idea of socially engineered society, or in Dutch, the ‘maakbare samenleving’ (‘society that can be made’). This idea presupposed that government intervention could achieve a lot to improve people’s lives, the quality of society, and happiness levels. Over time, in the Netherlands like elsewhere the mood has shifted to a society where people are responsible for their own lives and the state does not interfere with people’s personal sphere. Happiness, or quality of life, is seen as a purely personal issue.

In my view, that is too simplistic. In the Netherlands like in Denmark, it just appears that we are getting many factors right. Neither Denmark nor the Netherlands has comprehensive happiness policies, but in both countries the quality of education, healthcare, social security, and trust are amongst the highest of the world. That is something to cherish, but rather than an endpoint, it should be something to build on.

Happiness through reports (or biscuits!)

Instead of developing a vision and a framework on quality of life – such as in Bhutan’s Gross National Happiness, but also in the UK’s government’s programme to measure well-being, the Netherlands has resorted to another strategy: happiness by reports!

It isn’t the only one to do so. The French Sarkozy government commissioned the appraised but never implemented 292-page report on the measurement of economic performance and social progress. The German Parliament outdid the French Committee: it published its own report of no less than 844 (!) pages on Growth, Wellbeing and Quality of Life).

Dutch 'stroopwafels' biscuits, a way to happiness? I'd probably subscribe to that view. Source: image found on Pinterest

Dutch ‘stroopwafels’ biscuits, a way to happiness? I’d probably subscribe to that view. Source: image found on Pinterest

The Dutch Committee ‘Broad Concept of Progress’

The Dutch response came this year. In April, a Parliament Committee published its own report ‘Broad Concept of Progress‘ (Breed Welvaartsbegrip), which it managed to keep just below 100 pages. The Committee set out in an exercise with three aims: to determine what GDP measures and doesn’t measure, whether there is value in broader concepts of progress, and to propose what these concepts should look like.

The Committee does see value in using broader concepts, and evaluates international efforts, like the OECD’s Better Life Index, the EU’s Beyond GDP agenda, or statisticians’ guidance aiming to measure subjective well-being in a more harmonised way. At the same time, it acknowledges the efforts are still very divergent. The report also points the work in the Netherlands itself via the Monitor Sustainable Netherlands (Monitor Duurzaam Nederland) prepared by the Dutch Statistical Office and three advisory bodies.

Monitor wellbeing broadly

Ultimately, the Committee does not make a clear choice in answering the question how progress should be measures. Instead, it comes with three recommendations. Firstly, to broaden the Monitor Sustainable Netherlands to turn it inot a Monitor Broad Wellbeing, and provide annual updates of the level of general wellbeing in the Netherlands. Secondly, these annual reports shouldn’t end up in a drawer or the fireplace, but be debated with the government in a parliamentary debate. And finally, the Dutch government is called to contribute to the convergence of all various international efforts in wellbeing indicators.

The report doesn’t contain a great ambitious vision, but aims to set a pragmatic and practical agenda. In a debate with MPs today, the Committee seemed to have support for this approach. Hopefully, the Netherlands is making a good choice today. There’s merit in not entering too deeply into the ideological discussions on metrics, as these often arise in arguments of the kind of ‘my index is better than yours’. Instead, by putting the issue on the agenda annually and contributing to find an end in the international labyrinths, the Netherlands may slowly edge closer to develop a vision on happiness.

A trip of one thousands miles to happiness starts with the first step. Even if the Dutch state won’t be a happiness machine anytime soon, it has started a journey.

 

The Nanny State: repression of happiness?

It’s a pedagogic dilemma all parents will face: should we be strict to our children and prohibit them to do things that are bad for them? Or should we give them the freedom to learn for themselves that sand is not tasty, that you can fall if you climb a tree and that a drink too many has dire consequences the next day?

At the state level, similar dilemmas arise. Social-democrats traditionally don’t scare away from a dose of paternalism to educate citizens. Libertarians, on the other hand, abhor states that coerce a certain type of behaviour. Which recipe works best to develop a happy society?

Two weeks ago, I addressed the question “does size matter” – when it’s about the size of the state and happiness levels, that is. The evidence indicated that some of the happiest states are smaller countries, and that after a certain level? There is – surprisingly – a positive correlation between higher tax and higher life satisfaction. Does that also mean that a more active government, a Nanny State, could contribute to higher levels of happiness?

Nanny State Index

Republicans in the US and liberals in EU States – such as Dutch PM Rutte – agree on one thing: big government is big enough, and the state shouldn’t interfere too much with individuals’ life. That’s also the thought behind the Nanny State Index. It has been developed by liberal or libertarian think-tanks, and maps the strictness of regulation affecting personal choice in the 28 countries of the EU.

The Index lists four areas: e-cigarettes, tobacco, alcohol, and food. There is quite a difference in the freedom of access to this products across the EU. For instance, in Sweden alcohol is only available in state stores and e-cigarettes are effectively prohibited in Belgium.

Altogether, two of the paternalistic Nordics, Finland and Sweden, top the list. They stay ahead of UK and Ireland. As a result of strict rules on tobacco and so-called ‘sin taxes’ on unhealthy foods and drinks, Hungary completes the top-5. Denmark, which one might expect to be in sync with paternalist Nordics, only ranks 12th. On the lower end of the scale, we find Netherlands, Luxembourg, and Germany. The freest country of all is… the Czech Republic.

Nanny State Index. Source: www.nannystateindex.org

Nanny State Index. Source: www.nannystateindex.org

 

Does repression, or freedom, bring happiness?

Is there any correlation visible between being a nanny and low and high happiness levels? The evidence is difficult to interpret: the three top-1o countries of the World Happiness Report rank at different places in the Nanny State Index. Swedish is on top of the list, the Netherlands at the bottom, and to confuse the picture further, Denmark is mid-way in the table.

The implication might be the following. Policies may work out differently in different settings. It’s probably the same with children: all are different. Some kids will exploit freedom and end up in troubles; other will feel their confidence strengthened and will be good and happy citizens.

Basic income: utopian dream or the road to happiness?

Few ideas are more exciting for a happiness economist than a basic income. It sound like utopia: free money for everybody. Could it actually work?

The Swiss basic income referendum

The Swiss electorate had the chance to have its say on Sunday. And the answer is a resounding ‘no’: 77% of the population opposed the idea of a basic income. In the design for the Swiss referendum, the basic income would be unconditional: nothing would be demanded from citizens in exchange for the transfer of money. The level of the basic income would have to be set by law, according to the initiators, but they argued that 2,500 CHF for adults (around 2300 Euro) and 625 CHF for children would be an appropriate figure. That sounds like a lot, but remember that Switzerland is rich: a salary for a supermarket worker is around 3,000 CHF.

Proponents of the basic income argued that it would “enable the population to live a dignified life and to participate in public life”, providing people the freedom to live their life as they want. They also argued that basic income would be needed in an age where robotisation and digitisation would mean that many current jobs won’t exist anymore in ten years. The basic income has also been portrayed as an easier way to provide social security in a modernised and more efficient welfare state.

Opponents argued – not surprisingly – that the math behind the idea doesn’t add up. According to estimates, the Swiss state would spend around 200 bn CHF, or 35% of GDP, to pay its citizens such a basic income. It would require around 25 bn CHF extra in taxation revenue (which may have pros, as we saw last week) or expenditure cuts to finance the scheme. Beyond that, the idea would risk to destabilise the entire economy, as people wouldn’t work as much as before. In addition, there were moral arguments on the national laziness that would ensue.

Switzerland won’t have a basic income. But don’t believe proponents are demotivated by the loss. Instead, they see the fact that over 20% supported such a radical income as a sign that the real public debate is only about to start.

Performance by the initiators of the referendum, who dumped 8 million coins at a square when they reached the necessary number of 125,000 signatures to call the referendum. Source: Wikipedia,

Performance by the initiators of the referendum, who dumped 8 million coins at a square when they reached the necessary number of 125,000 signatures to call the referendum. Source: Wikipedia,

A Finnish experiment in simplification

While I am sympathetic to the idea, I do have my doubts on the math. It might be worth studying the consequences of a basic income for a smaller group, before implementing it for everybody. That is exactly what will be done in Finland: in 2017, it will provide a basic income to 10,000 lucky sampled citizens. Participation is mandatory. Importantly, the Finnish experiment will also simplify the social security system as part of the exercise.

Some proponents support basic income as a way to rationalise the various categories of social expenditure. Finland has around 100 different categories of social security spending, and during the experiment 50 of these would be replace by one single basic income. Also in other countries, citizens are subsidised for several hundreds of euro per month, for instance via services accessed for free. Couldn’t all this be simplified into one basic income? Or would it still be impossible to fund it? The Finnish experiment will be closely watched.

Free money, a way to happiness

Even if we may be unable to introduce free money for all, there are a couple of lucky people who actually received a basic income. The German foundation Mein Grundeinkommen crowd-funds a basic income: every time when they’ve gathered 12,000 Euro, one winner gets a basic income for one year. And according to its director Michael Bohmeyer (who receives his own monthly 1000 Euro basic income via the proceeds of shares in the company he left), the results are amazing.

Speaking at a panel discussion in Brussels, Bohmeyer told how he feels a lot more free, secure and relaxed with his basic income. When receiving the income, he realised how much people are in running mode every day. Work and the need to have a salary to provide for our life results in a lot of stress.

In his experience, that doesn’t mean that nobody would work anymore if they receive a basic income. Of the around 40 people who won a basic income through the lottery, all but one continued to work. And maybe it’s an issue of low trust in others: when asked if others would still work when they have a basic income, around 80% said no. When the question was if they themselves would still work, around 90% said they’d continue to work, says Bohmeyer (video in German).

Basic income may not only about simplified social security, but also about a better work-life balance and higher happiness. Let’s hope that the Finnish experiences shows that it is actually possible to get the math right.

For another passionate case on basic income, see the talk of Rutger Bregman, a Dutch journalist and basic income enthousiast. He wrote a book on the basic income under the title ‘Utopia for Realists‘.

Does size matter: higher tax, happier countries?

One of the oldest questions in political philosophy is of course: does size matter? Or to phrase it more precisely for the aims of this blog, does the size of the state influence the level of happiness of its population?

There are two ways of looking at the questions. Firstly, does the size of population matter for the quality of life? And secondly, how large a role should the government play in society?

Small is beautiful

At least at the anecdotal level, the first question is relatively to answer. It appears that smaller countries, typically, have happier populations than larger ones. From a theoretical angle, that makes sense. If a country is smaller, it is more likely to have a more homogenous population, and people are more likely to feel close to each other. For instance, this would result in a better community life, one of the factors associated with happiness. A glance at the 2016 World Happiness Report shows that most of the top-ten countries are relatively small, with Denmark, Switzerland and Iceland in the top-three, and only Canada, Netherlands and Australia (numbers six, seven and nine) having a population above 10 million.

Schermafbeelding 2016-05-22 om 18.37.08

Father state makes you… happy?

There is a second way of looking at the question, though. Does the share that the government takes in the economy and society affect happiness levels? Is it the invasive Big Government or rather the freedom of the laissez faire night-watcher state that makes people best off?

A book by Benjamin Radcliff, The Political Economy of Human Happiness, suggests there are three ways of measuring state size when assessing the correlation: welfare spending; overall government spending; and taxation.

From a theoretic perspective, one could presume a link between government spending and happiness. For instance, welfare policies could be expected to provide the safety net to lower income and/or unemployed people, and therefore reduce inequality. Similarly, a large amount of government spending – for instance by providing free or subsidised education or healthcare – could result in higher happiness levels.

Indeed, the evidence assessed by Radcliff suggests this kind of link. His data shows that for one of the metrics, linked to welfare spending, countries scoring high on this indicator, happiness levels are above one point higher than low-scoring countries. He suggests that this contribution to happiness is double that of being married (being married is positively correlated with happiness), and three times the negative drag of unemployment. To give an example: if your baseline happiness is 7, living in a state with high spending would statistically increase your happiness to 8. Being unemployed would drag it down to 6,7. That’s the magnitude of the influence of the state size according to Radcliff’s evidence!

More tax, more happiness

Government spending doesn’t come for free. While taxation of citizens and companies isn’t the only source of income, it typically is the most significant one. Could it really be the case that being taxed more resulted in citizens being happier?

Again, the data suggest there is a correlation. Radcliff even states that “higher levels of taxation suggest higher levels of satisfaction with life”.

The graph here compares taxation levels (tax revenue as % of GDP) with happiness levels (life satisfaction), based on data from the OECD and the World Happiness Report quoted above. It shows an increasing trendline, associating a level of taxation of 20% in this group of OECD countries with a happiness level of around 6.5. All others thing equal, a level of 50% is correlated with a happiness level of around 6.8: some one thirds of a point higher across the trendline.

But not all others things are equal: the distribution is broad and the effects are very diverse. Denmark is on the top right with a happiness level of 7.526 and the very highest tax level of 50,9. On the far left, we find Switzerland with a marginally lower happiness level of 7.509 and only half the tax rate at 26.6%. On the lowest part of the graph, with happiness levels just above 5 points, we find Portugal, Greece and Hungary, with taxation levels around 34-38%.

tax vs happiness

 

Correlation, goes the warning to every first-year student, is not causation. The 34 countries of the OECD provide some interesting figures, but there are many other factors than taxation that determine happiness. Idiosyncratic factors and practical things like a state’s efficiency – what kind of society does is create with the 20 or 50% tax money it collects? – certainly also play a role. I’ll look at some of what the states does next week: the Nanny State.

The Pursuit of Happiness, A User’s Guide

We hold these truths to be self-evident,

That all men are created equal

That they are endowed by their Creator with certain unalienable rights

That among these are life, liberty and the pursuit of happiness

 

This is how the United States Declaration of Independence, proclaimed on 4 July 1776 starts.

It’s great line. But how does one pursue happiness? What can one do to be happier? The US declaration of independence doesn’t answer that question, so I have resolved to do so myself. And while there are many, many, ways to pursue happiness, I think they ultimately boil down to three strategies.

Dedication

The first strategy to be happier is dedication. If you want, you can dedicate your life to pursuing happiness. The best example is the book under the name ‘The Happiness Project’, by  author Gretchen Rubin. It’s quite a thing: one day she decided that she wasn’t happy, and that she wanted to be happier. So, she made a plan.

Her plan was to dedicate one year of life to being happier. In doing so, she identified twelve topics to work on, for instance Marriage, Work, Family Relations, Reading, Spirituality, and so on.

Every month she undertook different projects. In January, she worked on her energy, and started by… cleaning and keeping the house in order. In June, she worked on friendship, and made sure to remember her friends’ birthdays. In July, she worked on money, firstly reducing her dependence on happiness, but also going on a major spending spree. I’ve been told it can be great to buy a new dress.

The dedication strategy is great if you’re a programmatic person. But if you’re not, or if you don’t believe you can plan and organise your way to happiness, you may prefer the awareness strategy.

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The idea of Dedication also comes forward in the movie The Pursuit of Happyness, a 2006 movie with Will and Jaden Smith

Awareness

A simpler strategy in the pursuit of happiness is awareness. This strategy I based on the simple assumption that all of us have happy moments. But sometimes we’re just simply too busy to realise our moments of happiness. Life is great, but sometimes we need to slow down to be aware of that.

That’s what the awareness strategy to the pursuit of happiness is based on: registering moments of happiness we all experience. That can be done by journaling, or by a tool called ‘Three Good Things’.

The Greater Good Science Center at Berkeley and the grass roots organisation Action for Happiness both promote ‘Three Good Things’ as, in the term positive psychology puts it, an ‘intervention’. The idea is that if you write down three things during the day that made you happy. It’s the best to do it every day ebfore you go sleep. Maybe you sat down for a coffee with a friend. You enjoyed a walk in the sun. And you favourite football team won. It can be very banal. But that’s happiness.

Either way, it will help you to remember and be aware. And it will also focus your spirit the next day. You’ll register moments during the day and think: this will go in my three good things today!

Curiosity

Again, the awareness strategy requires you to put aside some time every day. The third strategy is less time bound. I call it Curiosity. This strategy is based on the idea that we are curious people. Even when we don’t dedicate ourselves to happiness all day, or ensure we’re aware every day, we can develop happiness by being curious.

The idea that by learning about happiness, you can also absorb some of these lessons, and be happier, is one of the ideas behind my blog For A State of Happiness. There are plenty of places where you can learn about happiness.

For instance, there is a great course in the Science of Happiness on the online courses site EDx (enrollment is open!)

Or, there are dozens of TED talks about all aspects of happiness. On how to spend money on gratitude, on irrationality, or compassion. You name and you can find a talk!

Another place to be curious is to read blogs. Of course you can try For A State of Happiness! But there are many. Gretchen Rubin, from the Happiness Project under the Dedication strategy, has a blog. There is a blog of the Minimalists, blogging how a life with less stuff makes them happier. And Action for Happiness shares all kind of happiness facts and tools on their site.

Which strategy works for you?

The US Founding Father’s put it nicely when they stated that the Pursuit of Happiness is our unalienable right. But happiness is so personal. We all pursue happiness in our very own ways. Whether your pursuit resembles the Dedication, Awareness or Curiosity strategy is irrelevant. In either case, I’ll wish you luck on the way to a state of happiness.

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