Happiness Is Not Utility

2014-11-14 City and Rural Area Happiness

In recent years, economists and policy makers have started to measure happiness (“subjective wellbeing”) and design policies to maximize it. In a paper for Vox, researchers point out that happiness isn’t the same thing as utility or welfare. This means that a government’s attempts to maximize happiness may work to undermine social welfare.

In a series of novel experiments and surveys, Benjamin et al. (2011, 2012, 2013) conduct surveys about actual or hypothetical choices people make and measure the expected happiness associated with each choice. They find that actual choices and happiness-maximising choices are positively correlated. But they are not identical. Respondents are prepared to sacrifice happiness in furtherance of another objective, such as a higher income (Benjamin et al. 2011).

The researchers conducted their own research into choices people make about where to move and confirmed the basic finding: people are willing to move to unhappy places if there is an economic incentive to do so. This means that happiness is only one variable that people are trying to maximize in their lives. They have other goals. Income might be one but, as the researchers note, other ideals like “freedom, nobility, and self-respect” might also play a role.

This isn’t just academic. It’s actually another stern lesson about the limits of centralized planning to improve our lives. Underlying this entire discussion is one simple fact: no one actually knows what human beings are trying to maximize. The concept of “social welfare” is undefined, and so efforts to use policy to maximize it are suspect, at best. A better aim is probably to try and maximize freedom so that people will be best able to maximize their own welfare as they choose to define it, rather than relying on some universal definition being imposed society-wide.

4 thoughts on “Happiness Is Not Utility”

  1. You make an odd, essentially teleological, move in the last paragraph. Having just recognized the difficulty of defining welfare, don’t you feel just a little hubristic suggesting that “freedom” is the magic elixir? The tragedy of the commons, and the harm that majorities or the powerful can do to minorities or the weak, are just two examples of problems that should give you pause with using freedom as a univalent measure.
    I imagine that one might come to freedom as a ‘best we can do’ in a world of finite time and limited information, but it’s a complex and challenging discussion, not a one liner. (And not where I come out, for what little that’s worth . . . although that is ultimately the reason I comment here.) Complicated by whether you mean individual freedom or freedom by group or class, be it family or something larger. And arguably not where God or religion comes out, depending on what you mean by “freedom”.

  2. Chris-

    Having just recognized the difficulty of defining welfare, don’t you feel just a little hubristic suggesting that “freedom” is the magic elixir?

    The argument for freedom over centralized planning is founded in epistemic humility: we cannot determine the welfare of others so we ought to err on the side of providing them the opportunity to make decisions themselves. I’m having a hard time getting from there to “hubristic”.

    I imagine that one might come to freedom as a ‘best we can do’ in a world of finite time and limited information, but it’s a complex and challenging discussion, not a one liner.

    That’s very astute. I would only add to that “although it’s not a one-liner, sometimes one line is all you have time for.” It was either end with a generic nod towards freedom over centralized planning (and leave them both in abstract terms) or embark on a detailed discussion of Amartya Sen.

    I think the problem is just that you assumed a great deal of finality and specificity that aren’t there. Not every blog post can be definitive or comprehensive. My point is just that when centralized planning fails, the logical fallback is some kind of decentralized planning (aka “freedom”). But that can mean a lot of different things and entail a wide variety of policies. Free markets require regulation and civil courts and political rights require laws and enforcement mechanisms.

  3. Nathaniel:
    It is true that “Not every blog post can be definitive or comprehensive.” What I’m suggesting is that you inject a bit of the epistemic humility that you express in reply, and that I know is true of you, in the OP. Otherwise, the OP–with “central planning” and “maximize freedom” as a paired contrast–too quickly invites a right/left political reading with all the baggage that brings, including that most readers already “know” the(ir) answer.
    Chris

Comments are closed.