Measuring happiness: a view from management science

This year's BPS Annual Conference was visited by Stephen Hicks of the Office of National Statistics, to present the latest on the new measurement of national well-being. Still in final development, the content presented seemed well-considered and balanced – capturing elements of hedonic feelings of current happiness as well as a sense of meaning. A recent review in the Academy of Management Perspective looks at the history of the measurement of happiness and provides some of the more consistent findings.

Authors David G. Blanchflower and Andrew J. Oswald present data from several large surveys – 48,000 and 300,000 – conducted in the United States. Their approach is to report how variables such as age, income, or marital status contribute to equations that predict measures of happiness, in terms of their strength and direction. These suggest, for instance, that in America being black is associated with lower average happiness, as is (to a smaller extent) being male. The variable most relevant for this blog is joblessness; while it's impact has been well-communicated (for instance by Richard Layard) the striking size of the effect – twice the impact of being black or five times being male– is illuminating. However, the authors point out that less than 10% of the variance of the happiness measure is explained by the variables covered: we haven't come close to bottoming out a comprehensive happiness equation.

The authors point to a consistent association between income and happiness in the cross-sectional samples – in their view, “money buys happiness”. However, they also point to the phenomena, identified by Richard Easterlin in the 1970s, that a country's economic growth tends not to be tracked by happiness. It's currently certainly a useful buffer, with the have-nots experiencing a subjectively less happy life vs those secured by money, but whether wealth is intrinsically linked to happiness still seems unclear.

Blanchflower and Oswald also present data on job satisfaction from the US. Overall, this has trended slightly downwards since the beginning of that data set in 1972, suggesting that we are struggling to deliver the working conditions that people desire. Higher levels of satisfaction were associated with being white, highly educated, older, in part time employment, and, to a substantial degree, self employed. Additionally, workers who feel secure in their jobs show a large premium to their ratings of satisfaction.

The authors point out a 2008 paper they authored which demonstrated that happiness levels are tracked by healthy blood pressure from country to country, with citizens of Denmark and the Netherlands thriving by both measures. They argue that the future of this field will be of convergence, where “the social science literature on happiness will slowly join up with a medical and biological literature on physical well-being.”

David G. Blanchflower, & Andrew J. Oswald (2011).
International Happiness:
A New View on the Measure of Performance Academy of Management Perspectives, 25 (1), 6-22