… and the Pursuit of Happiness: Wellbeing and the Role of Government

Economic Growth

… and the Pursuit of Happiness: Wellbeing and the Role of Government

by Philip Booth, et al.

Institute of Economic Affairs

January 23, 2012

Explicit attempts by government to control GDP, or rapidly increase GDP growth, have normally failed. Such a target-driven mentality is part of the conceit of central planning. Attempts to centrally direct policy towards improving general wellbeing will also fail. Contrary to popular perception, new statistical work suggests that happiness is related to income. This relationship holds between countries, within countries and over time. The relationship is robust and also holds at higher levels of income as well as at lower levels of income. This calls into question the assertion that people are on a ‘hedonic treadmill’ that prevents them becoming happier as their income rises beyond a certain level of income.

URL: www.iea.org.uk/sites/default/files/publications/files/IEA%20Pursuit%20of%20Happiness%20web.pdf