Excellent post thank you! I want to add a couple things.
While focusing on things besides economic growth sounds very important, I’m not sure focusing on these things at the expense of economic growth would be good. Some of the proposals for increasing happiness in this post such as job security sometimes decrease economic growth. Decreasing the rate of economic growth negatively upends people’s expectations in the ways recessions do, producing the kind of decrease in happiness observed within business cycles. According to the Congressional Budget Office, real median household income in the US increased by 64% between 1979 and 2018. Yet for many people this was not enough to compensate them for the loss of the faster rate in increase in incomes of the postwar period. I don’t have a statistic on the faster rate of increase in incomes during the postwar period, but the difference has been cited by enough economists such as Duflo and Banerjee to make me confident it was larger. People often cite this loss when explaining their support for populist candidates like Trump and Sanders.
As we search for better things to focus on than growth, I want to caution that very different solutions could be better in different countries. I read in my economics textbook that the average American would be only 85% as well off if they lived in the average Western European country, accounting for the value Americans place on income, income inequality, and health (but sadly they didn’t measure the value Americans put on economic mobility, which according to a talk I went to by the UN is typically better in Western Europe). This casts doubt on the idea that expanding the welfare state substantially would increase American’s happiness.
Excellent post thank you! I want to add a couple things.
While focusing on things besides economic growth sounds very important, I’m not sure focusing on these things at the expense of economic growth would be good. Some of the proposals for increasing happiness in this post such as job security sometimes decrease economic growth. Decreasing the rate of economic growth negatively upends people’s expectations in the ways recessions do, producing the kind of decrease in happiness observed within business cycles. According to the Congressional Budget Office, real median household income in the US increased by 64% between 1979 and 2018. Yet for many people this was not enough to compensate them for the loss of the faster rate in increase in incomes of the postwar period. I don’t have a statistic on the faster rate of increase in incomes during the postwar period, but the difference has been cited by enough economists such as Duflo and Banerjee to make me confident it was larger. People often cite this loss when explaining their support for populist candidates like Trump and Sanders.
As we search for better things to focus on than growth, I want to caution that very different solutions could be better in different countries. I read in my economics textbook that the average American would be only 85% as well off if they lived in the average Western European country, accounting for the value Americans place on income, income inequality, and health (but sadly they didn’t measure the value Americans put on economic mobility, which according to a talk I went to by the UN is typically better in Western Europe). This casts doubt on the idea that expanding the welfare state substantially would increase American’s happiness.