RICERCA ITALIANA     

Economics Happiness and Social Interactions

Università degli Studi di Milano-Bicocca

Abstract

The 'Economics of Happiness' has been emerging as a theoretical and empirical field in contemporary Economics. In the present project particularly the relational aspects of the field will be taken up and made the object of research.
If certainly there is nothing new in the assertion that our happiness largely depends on the happiness of others, it is on the other hand less easy to understand why Economics - so keenly focussed on the well-being of individuals and of nations ever since its historic origin - seems then to have ended up making next to nothing of the relational dimension of the study of the welfare and of the wealth of nations.
Through the late decades, however, there have been clear signs of a change of direction and emphasis, so that we could say that nowadays the economic science is in some sense reverting to the kind of happiness studies, which used to be pivotal during the 18th century - for example with the researches on 'public happiness' so characteristic of the Milanese school at the time.
Indeed much of the current research, both theoretical and applied, in the field has been absorbed by the so-called 'paradoxes of happiness', which basically emphasize that any index of Subjective Well-Being (SWB) - obtained through direct interviews - appears to exhibit a poor relation to per capita income or wealth. Such and similar propositions have been exciting much interest due to their paradoxical aspect of putting in question some >>>

Principal Investigator

Pier Luigi PORTA Università degli Studi di MILANO-BICOCCA

Research Objectives

This project proposes to take up and strengthen a specific line of research which is currently producing a number of contributions to economic theory and to applied economics worldwide with significant echos also in related disciplines. The mentioned line of research gravitates around the so-called 'paradoxes of happiness' in economics and basically concerns the evidence - confirmed by a wide number of enquiries in several contexts and at several stages in time - that SWB (Subjective Well-Being, see below under 2.2 or scientific basis to the present project) does not appear to be positively correlated with personal income or personal wealth.
Whether subjective happiness or subjective well-being is considered or, else, 'objective' indicators of well-being are studied (mental disturbances, rate of suicides, alcoholism etc.) the result emerges of a puzzling paradoxical relationship of income and wealth to well-being in advanced countries; a relationship which is not immediately reconciled with current economic theory.
The present project enters the ongoing debate on happiness in economics, to which the members of the research units of the project have themselves been contributors in the recent past. It is the distinctive feature of this project that it undertakes to work in the field with the specific aim of focussing on the social and, more precisely, relational dimension of the link of economics to happiness.
Psychologists and sociologists have been >>>

First Results

The first phase is designed to reach two objectives.
1. Critical revision of the extant literature, in order to provide a basis and a common language for an effective development of the further phases. It is at that stage that theoretical analysis on the concept of happiness is of peculiar importance and a critical separation of happiness from other similar concepts has to be elaborated. The interdisciplinary interaction is of special significance and particularly the developments of cognitive economics as the field of study where economists and psychologists interact.
Historical and methodological analysis is also of special impact here, particularly in evaluating progressive and degenerate progams and try to make sense of the formative stages of current economic methodology on choice and rationality.
The first phase will close with a workshop to be hosted at Bicocca.
2. A second objective of the first phase of the project consists in designing and organizing laboratory experiments (Padua, Piemonte Orientale, Torino, Trento) and empirical research (Bicocca).The second phase is mainly devoted to the construction and the elaboration of empirical evidence through laboratory experiments and the use of questionnaires.
It is expected the results of empirical research to have a key role in the development of the theoretical part of the research projectThe expected results of the third phase are global and synthetic results: the project will >>>

Timescale

24 months

National and international background

The problem.
The widespread unease affecting high income systems has contributed to sparking off an intense multi-disciplinary debate on the so-called 'paradoxes of happiness'. As far as empirical findings are concerned, the best known indicator in this context is the so-called index of Subjective Well-Being (SWB) which purports to measure the individuals' perception of the degree of satisfaction they experience in their lives. Though imperfect in many ways the measure of SWB has the advantage of being long applied in different contexts over extended time periods by both economists and psychologists and it has long been at the basis of a number of econometric analyses in the major scientific journals in economics (cp., e.g., Veenhoven, 1993).
In a number of cases, including Japan and the US, the measure of SWB does not increase or even declines in spite of the attainment of higher and higher levels of per capita income. As economists are, generally speaking, accustomed to think of income as an indicator of welfare, they tend to consider the above results as paradoxical (the 'happiness paradox' or also the 'Easterlin paradox') (cp., e.g. Bruni, 2004). Sociologists also have had their say on the paradox (e.g. Putnam, 2000; Wright, 2000; Lane, 2000).
The Financial Times has recently reported (April 8, 2003) that the study of SWB is turning into a boom industry. Some of the major economic journals have hosted symposia on the issue (see, for example >>>