Famed economist helps us know how to be happy

Winning millions on the lottery, landing that dream job, finding love, having a family, traveling the world: We all entertain thoughts of the life changes that we believe would bring us greater happiness. But would they?

It turns out that an economist can give us the answers. University Emeritus Professor of Economics Richard Easterlin at the USC Dornsife College of Letters, Arts and Sciences, has devoted more than 50 years to researching happiness.

His new book, An Economist’s Lessons on Happiness: Farewell, Dismal Science! (Springer, 2021), is the fruit of a lifetime of his own research and that of fellow economists and psychologists dedicated to understanding and improving happiness — whether of individuals or nations.

Richard Easterlin’s new book sums up more than 50 years devoted to understanding what makes us happy.

The title is an ironic reference to the fact that economics, once dubbed “the dismal science,” now offers prescriptions for boosting happiness. Some of those answers are surprising — more money won’t bring more happiness, neither will economic growth, while babies turn out to be a mixed blessing.

Easterlin is the creator of the eponymous Easterlin Paradox, which states that if we look at any given point of time, on average people who have more income are happier. However, this finding is contradicted by time series data, which follows people’s happiness over a length of time as their income increases.

“It’s the time series relationship that’s relevant to questions like ‘would more money make me happy?’” Easterlin says. “You’re thinking, ‘what’s going to happen over time as I get more money, will I become happier? And the answer to that is quite consistently ‘no.’”

This seems counterintuitive, but Easterlin explains that it’s all down to a psychological concept called “social comparison.”

“We make judgments about our own income based upon what others are getting, and if others are doing a lot better than us, we tend to be less happy,” Easterlin says. “It’s true that the increase in your own income by itself will make you happier. But what happens in practice is that, on average, as your income goes up, everybody else’s goes up, and the result is that nobody is happier.”

Here, Easterlin answers 12 questions about happiness — refuting some of our preconceived notions about what makes us happy.

You are known as “the father of happiness economics.” What made you decide to write this book now and what do you hope that people take away from it?

Basically, the book is a summation of what I’ve learned teaching the economics of happiness, so retirement provided an opportunity to set it all down. My hope is the same as it was for my undergraduates — that it may help to make people’s lives better.

Can happiness be measured, and if so, how?

Yes, surprisingly it’s quite simple — we ask people to rate how happy they are. A lot of research has been done by psychologists that shows the replies are meaningful and comparable, at least for groups of people (rich and poor), not necessarily at the individual level.

Is there a difference between happiness and well-being?

I think most people do not, themselves, make a distinction. But until happiness became a subject for the social sciences, most work involved the author’s prescriptions on a priori grounds for what constitutes “The Good Life,” rather than trying to understand how people themselves viewed well-being.

Who is happier — women or men, young or old, rich or poor? 

Happiness goes up and down over the life course. Women are happier early in life; men are happier at older ages. At a point in time, the more affluent are happier.

Many people believe that having more money will make them happier. Is that true?

The evidence is to the contrary. Incomes in the United States have tripled over the past 70 years; happiness has, if anything, declined.

How about finding a partner? Getting married? Having a baby? Taking more exercise?

Having a partner, whether one gets married or not, definitely increases happiness. The prospect of — and having — a baby initially raises happiness, but that gain tends to wear away as children grow up. Exercise that improves health will increase happiness.

Does religion or faith make us happier?

There is a positive correlation between religion and happiness, but telling people to “get religion” probably has no effect.

Which countries are the happiest and why? Does a country need to be rich to be happy?

The Nordic countries are happiest because they are welfare states that design policies dealing directly with people’s foremost worries and concerns. A country does not need to be rich to be happy. Costa Rica, with an income one-fourth that of the U.S., is happier because its government has focused on policies like those in the Nordic countries.

What can governments do to improve happiness in societies?

Provide assurance of jobs and income security, assurance of health care and, more generally, policies that deal with people’s most urgent worries and concerns.

How can we increase our happiness?

Briefly, spend more time on family and health, less time focused on making money.

Which results from your research into happiness have surprised you the most?

The contradiction between the relation of happiness to income — positive at a point in time, but a nil relation over time (now known as the Easterlin Paradox).

After a lifetime of research on this topic, what is your top tip for people trying to increase their happiness?

Focus on your family; stop comparing your status to others.

The material in this press release comes from the originating research organization. Content may be edited for style and length. Want more? Sign up for our daily email.