The use of happiness research for public policy

Research on happiness tends to follow a “benevolent dictator” approach where politicians pursue people’s happiness. This paper takes an antithetic approach based on the insights of public choice theory. First, we inquire how the results of happiness research may be used to improve the choice of institutions. Second, we show that the policy approach matters for the choice of research questions and the kind of knowledge happiness research aims to provide. Third, we emphasize that there is no shortcut to an optimal policy maximizing some happiness indicator or social welfare function since governments have an incentive to manipulate this indicator. Research on happiness1 has spurred a lively debate on new directions in public policy. Many governments, international organizations and think tanks commission reports on alternative measures of social progress and their policy consequences.2 The scientific 1 The scientific term is subjective well-being. We do not in general distinguish between these concepts but simply use the more popular term “happiness”. Distinctions between the various concepts are only made when it comes to particular measurements of subjective well-being and when empirical studies are referred to. Following the literature, the simpler and more popular term happiness is used where suitable. 2 A prominent example is the so-called Sarkozy Report by Stiglitz et al. (2009). Bruno S. Frey and Alois Stutzer are also associated with CREMA—Center for Research in Economics, Management and the Arts. B. S. Frey University of Warwick, Coventry, UK B. S. Frey (B) Department of Economics, University of Zurich, Wilfriedstrasse 6, 8032 Zurich, Switzerland e-mail: [email protected] A. Stutzer Faculty of Business and Economics, University of Basel, Peter Merian-Weg 6, 4002 Basel, Switzerland e-mail: [email protected] 123 Author's personal copy