Measuring Well-Being and Happiness
On April 30, the Laboratory for Comparative Social Research sponsored a seminar in St. Petersburg by Associate Researcher Francesco Sarracino on ‘Do people care for a sustainable future? Evidence from happiness data’. Sarracino is an economist at Luxembourg’s National Institute of Statistics and Economic Studies (STATEC) and specializes in social capital, economic growth and well-being; he recently spoke at length with the HSE news service about his research interests, implications of measuring happiness and wellbeing for policymakers, and his experience collaborating with the Higher School of Economics.
— Is there a universal formula that is most trusted for calculating the relationship between current well-being and economic status? Sometimes the Happy Planet Index findings are hard to believe...
— Unfortunately, there is no universal formula. Well-being is a multi-dimensional concept and it is difficult to monitor all its dimensions at once. There are many attempts in this regard and the Happy Planet Index is just one of them; it focuses on a mix of well-being, life expectancy and ecological footprint.
In my studies, I use measures of subjective well-being. These are people’s own evaluations of their well-being. Years of research in psychology, sociology and economics have demonstrated that subjective well-being is reliable, valid, and comparable across countries, and – most importantly – it provides insightful information about many social and economic phenomena. One notable example is the Easterlin paradox, a topic that received considerable attention in recent years. Thanks to subjective well-being, we know that economic growth is not enough to warrant higher well-being in the long term. Promoting social capital and limiting income inequalities are two conditions necessary to durably improve people’s well-being.
— What are the happiness data to which you refer in your report? How were they collected? What are the indicators?
— The happiness data I refer to are based on answers to questions about how satisfied or happy people are with their lives in general. For example, in the course of surveys interviewers may ask respondents to answer questions such as the following: 'All things considered, how satisfied are you with your life as a whole these days?' Answers are usually ordered on a scale, such as from 1 to 10 where lower scores stand for dissatisfaction and higher scores indicate satisfaction. I emphasize that in this literature the words happiness, life satisfaction or subjective well-being are often used interchangeably, although they mean very different concepts. We have to be very careful when we use them and to always keep in mind the differences among them.
Social sciences have radically changed and evolved significantly in recent years thanks to research on subjective well-being. The main result, and possibly the most important one, is that these disciplines got closer to people’s reality
However, the power of such a simple concept, subjective well-being, is formidable as social scientists finally have a direct way to measure people’s well-being, to study what makes people happy (money, social relationships, education, etc.), to evaluate the efficacy of a policy for well-being, and much more. Social sciences have radically changed and evolved significantly in recent years thanks to research on subjective well-being. The main result, and possibly the most important one, is that these disciplines got closer to people’s reality.
The second benefit that I see is that studies on subjective well-being allowed many borders among disciplines to be crossed, as they truly require the interaction of economists, sociologists, political scientists, and psychologists, to mention a few.
— Improving quality of life, showing people what might be shifted in perception of life now - is that what are you aiming to achieve?
— I don’t really think I can tell people what they should and should not do to be happy. Happiness is something intimate and truly subjective. What is good for me might not be necessarily good for you and both ways are equally valid.
I aim to inform policymakers, those who take decisions about how to organize our lives. They constantly need support to take decisions on a number of topics. Studies on well-being allow us to predict what the impact of a given policy can be on people’s well-being, whether it will improve it or not. For example, recalling a previous example, for many years the attention of policymakers focused on promoting economic growth. This is the recipe advocated by national and international institutions to deliver better lives.
Despite the amazing growth happening in many western countries, and more recently in developing countries, people’s perception of their well-being has not improved. I’ve studied this issue at length, focusing on many countries including Germany, China, groups of developed and transition economies, and more recently Russia. What I’ve learnt is that unconditional economic growth can generate side effects that more than offset the positive impact of economic growth for well-being. It is in one of these studies, which I run together with Małgorzata Mikucka from the University of Leuvain-la-Neuve (Belgium), that I identified an important relationship to durably improve people’s well-being: promoting social capital and containing income inequalities. When these two conditions accompany economic growth, the evidence suggests that we can be reasonably sure that people’s well-being will also increase. This is the kind of advice that I aim for.
I aim to inform policymakers, those who take decisions about how to organize our lives. They constantly need support to take decisions on a number of topics
— You were the editor of the book The Happiness Compass: Theories, Actions and Perspectives for Well-Being (Nova Science Publisher, Hauppauge, 2013). What a wonderful idea to study happiness and provide a reference tool for understanding current theories of happiness! What is your favourite theory, which you believe strongly?
— The book is a collection of contributions to the study of well-being from scholars of various disciplines. Altogether, the book tries to give an idea of the foundations of the literature on well-being, its most recent contributions and, in the last part, the possible new perspectives and applications of well-being studies.
In a more recent book, Beyond Money: The Social Roots of Health and Well-Being, co-edited with Małgorzata Mikucka, we provide a more detailed view of the role of social relationships for people’s well-being and health. A number of theories are currently under development, but the one I contributed the most and that I find most convincing is called ‘Negative Endogenous Growth’. It is a model of economic growth developed in the early 2000s by two Italian economists, Stefano Bartolini and Luigi Bonatti. The model suggests that economic growth can be the outcome of a substitution process where free resources are eroded by the market and replaced by private substitute goods.
The model is too articulated to be presented in a few words here, but I will give you an example. If the cities where we live become too large, dangerous and it’s not safe to go out, we have fewer opportunities to meet friends or enjoy a walk in a park. This will reduce our well-being and will push us to look for alternatives to compensate for the loss. For example, we could invest money to make staying at home more pleasant and comfortable. The substitution of the free good, meeting friends or having a walk outside, for a private good, the latest home theatre, implies an expenditure — economists call it defensive expenditure — that will ultimately benefit economic growth. The result is that people will be less happy because all that they can do for free is becoming scarcer; they will experience more time pressure because they need to work more to afford defensive expenditures, which will give them less time to devote to free and social activities, and so on. I find this theory convincing and we have accumulated a considerable amount of evidence supporting it.
The substitution of the free good, meeting friends or having a walk outside, for a private good, the latest home theatre, implies an expenditure — economists call it defensive expenditure — that will ultimately benefit economic growth. The result is that people will be less happy because all that they can do for free is becoming scarcer
— What has your cooperation with HSE St. Petersburg been like? How and why did it start? What about it is challenging for you? What plans do you have to develop it?
— My cooperation with HSE dates back to about four years ago when I first became an affiliated researcher of the Laboratory for Comparative Social Research. Since then my visits to Moscow and St. Petersburg have been pretty regular and always very insightful.
Last year a new International Master in Comparative Social Research was launched at HSE and I was asked to teach happiness economics here. I think it is a great opportunity to share my experience with younger and motivated people, and it is a great responsibility. I am very happy to be here and contribute to this challenging programme.
In the beginning, I had some difficulty with the Russian language. At the university, many people speak English, but outside is more complicated. But I am getting used to it and I like St. Petersburg. I don’t have any plan for the future. I guess much will depend also on the degree of satisfaction of the students and other colleagues. For sure, I will keep my collaboration with the Laboratory for Comparative Social Research and, if my contribution can be still be valuable for HSE, I will be happy to continue.
— Knowing so much about theory of happiness, have you discovered your own way to be happy?
— I think a lot about what happiness is and what makes me happy. I think what makes me happy is to be good to myself and to others and finding the time to devote to things that I care for and am interested in. I believe that happiness is having a dream and the will to pursue it.
Anna Chernyakhovskaya, specially for HSE News service
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