GEORGE MACKERRON (inventor of Mappiness): Well, Alex has stolen the content on my first couple of slides. So I guess I’m George, and I’m going to talk to you about the economics of happiness and some of the findings of my own research.
As Alex says, I’ve got several hats, academic economist, creator of a study called Mappiness, which is largely what I’ll talk to you about today, which I think is the biggest momentary happiness study that’s been done, and also, as Alex says, co-founder of a startup. So I research election environment economics and behavioral economics and happiness economics. I also teach PhD students regular expressions, but no one knows that they need to know regular expressions until they come to my session. They don’t come to my session because they don’t know they need to know regular expressions, despite the fact that I advertise it with an XKCD cartoon. Anyway, I know something about measuring and possibly something about improving happiness.
And as Alex says, I do a certain amount of teaching in the course of all of this. So today I want to give you a very brief history of happiness economics, persuade you that happiness is worth measuring, and that happiness measurements are valid and useful. And the poster for this talk promises to answer this question: How happy would it make you be to be drinking by an estuary in the vicinity of riots the day after your football team lost unexpectedly at a full moon when Donald Trump had just won an election? So I’ll do my best to answer that question as we go along. And I can tell you right away that two of those factors aren’t important.
But I’ll leave you guessing for now as to which two those are. So a very brief history of happiness economics. And I’m going to explain this via a timeline of old white men, which given the context is perhaps not my brightest idea ever. But anyway, we start with the 18th century. And we have Jeremy Bentham. And reading straight from Wikipedia, “Bentham is regarded as the founder of modern utilitarianism. And he defined as the ‘fundamental axiom’ of his philosophy the principle that ‘it is the greatest happiness of the greatest number that’s the measure of right and wrong.'” And so this sort of hedonic or philosophic calculus, which Bentham called it, happiness maths, is basically a kind of cost benefit analysis using pleasure and pain. So when you’re trying to figure out what action is right, you should consider the pleasure and the pains that result from it, and how intense they are, how long they last, how certain you are of them, how near they are at hand, how likely they are to lead to future pleasures and pains, and how many people they benefit or they hurt. And then you should consider all the alternatives. And that might be the best way to choose what to do.
Now, around 100 years after Bentham, we have Edgeworth. He was the founding editor of “The Economic Journal,” and laid lots of the foundations of sort of modern utility theory. And Edgeworth went as far as to imagine something that he called a hedonometer, an idealized happiness measuring machine. And he waxed really lyrical about this and says “let there be granted to the science of pleasure what is granted to the science of energy. Imagine an ideally perfect instrument, a psychophysical machine, continually registering the heights of pleasure experienced by an individual, exactly according to the verdict of consciousness or rather diverging there from, according to a law of errors. From moment to moment, the hedonometer varies, the delicate index now flickering with the flutter of the passions, now steadied by intellectual activity, low sunk whole hours in the neighborhood of zero, will momentarily spring up towards infinity.” But unfortunately, Edgeworth’s peers were mostly not on board with this idea. Economists then, in the early 20th century, increasingly wanted to be thought of as scientists. They had a kind of physics envy.
And they certainly did not want to be thought of as psychologists such as Freud, who we see here. And therefore, if we look at Pareto, Pareto, for example, was very proud of his Theory of Choice in which he said that every psychological analysis is eliminated. And he boasts that he’s not interested in the reason why man is indifferent between one bundle of goods and another bundle of goods. “I notice the pure and naked fact.” And so words like willpower and imagination and feelings began to vanish from economics.
Instead, economists came up with very elegant and certainly very useful theories of well-being as preference satisfaction, where you’re happy to the extent that you can satisfy your consumer preferences, and you can approximate the extent that you can satisfy you consumer preferences by how much income you have. And therefore the recommendations of economists tended towards– both for individuals and for nations– well, do your best to get richer. Now, 20th century economists were not stupid. And of course, they’re not oblivious to the potential unintended consequences of that. But they have this special powerful Latin to protect their assumptions from that.
So we just say “ceteris paribus,” and that means all other things being equal– and definitely it’s true– but all other things being equal, aiming to get richer is a pretty solid idea. But around the 1970s, some economists started asking awkward questions on this topic. And in particular, here is Richard Easterlin of the University of Pennsylvania and now the University of Southern California, who’s commonly regarded as sort of the grandfather of modern happiness economics. And Easterlin published a paper in 1974 with the title “Does Economic Growth Improve the Human Lot?” which was probably the economists’ equivalent of is the pope Catholic and do bears go to the toilet in the woods? But Easterlin was sort of looking to confront this economic growth data with some kind of external measure of happiness. And in order to do that, he used self-reported well-being survey data.
And following Easterlin, lots of other economists have taken up this line of thinking. And one of the key figures, certainly, in this country is Professor Richard Layard, who is a labor economist at LSC and a member of the House of Lords. Layard wrote an influential book in 2005 based on some earlier lectures, and along with the former cabinet secretary here, Gus O’Donnell, has been kind of instrumental in getting the UK government to take well-being measures seriously, both within the civil service and in the country at large. I said Easterlin used self-reported well-being survey data. What is that data? Well, it answers to questions like this.