What is it all about after all? The happiness factor ...
Posted by Riccardo Paterni on 09/02/2018

An unsettling paradox: over fifty years of marked progress yet we are not any happier...

Why does a leading economist write a book about ‘soft stuff’ such as happiness? Even more puzzling: why does he title the book “Happiness. Lessons from a new science”? Richard Layard is the founder of a relevant economics research center within the London School of Economics, author of several academic books on topics such as unemployment and inequality. This latest effort of his is truly ground braking and starts from a simple observation: “There is a paradox at the heart of our lives. Most people want more income and strive for it. Yet as Western societies have got richer, their people have become not happier. This is no old wives’ tale. It is a fact proven by many pieces of scientific research. As I’ll show, we have good ways to measure how happy people are, and all the evidence says that on average people are no happier today than people were fifty years ago. Yet at the same time average incomes have more than doubled. This paradox is equally true for the United States and Britain and Japan”. Layard in this book tries to go to the roots of this paradox and in the process makes a strong case for learning how to use the ‘science of happiness’ in our daily lives while supporting the argument to raise this science to the level of public political debate and action.

The seven factors that influence happiness

Layard points out seven factors that are key to the perception of happiness. They are (listed in order of relevance) 1) family relationships; 2) financial situation; 3) work; 4) community and friends; 5) health. The two additional factors influence all of the first four and are equally relevant: a) personal freedom; b) personal values. The description of these factors articulates some interesting conclusions that may appear as part of ‘common sense’, yet now they are ‘certified’ by official scientific method and research. Here some of them: we are happier when we manage not to be totally self absorbed and we actively manifest an interest towards other people well being; work does not provide us simply with material means to survive, it gives us an intrinsic sense of meaning and satisfaction that has a strong influence on our perception of happiness; the way that we ‘frame’ our daily reality has a strong impact on our perception of happiness; happiness is fundamentally and individualistic value, yet as human beings we have a moral sense that brings us to value other people perceptions of happiness. Layard leverages upon this last assertion in order to stress the importance of beginning to consider happiness as a way to measure the real progress and development of a collectivity (being either a community, a nation or a continent).

Measuring happiness to understand the real progress and development... OK! Are economist out or their league?...

One of the key chapters of the book is about this thought. Layard states that for a long time the development of a nation has been measured in terms of Gross National Product (GNP) and certainly happiness is not a monitored factor. Quite interestingly it was not always this way: during the 19th century most of the British economists considered happiness, collective happiness, as a measure of the real development of a nation. These economist saw happiness as a measurable factor and thought that an increase in material wealth brought a progressively decreasing perception of happiness. Unfortunately during the 1930s behavioral science (James, Pavlov, Skinner) conquered center stage discarding the relevance of ‘inner’ feelings: concrete numeric data relevant to observable and measurable behavior took over for good and the utilization of GNP became the key tool to measure of progress and development. This way increasing purchasing power has been considered as a display of increased progress and well being. All of this has gradually shaped a false perception of reality; just try to ask anyone if he/she considers the GNP as an actual measure of a nation well being... Layard is quite effective in developing this argument and articulating the need for a ‘new economic science’: a science capable of integrating psychological and sociological factors to the current one dimensional focus on numbers in order to properly represent the reality perceived by the people. Unfortunately this one dimensional focus is currently the one many public policies are based upon.

When economics starts to focus also on the mind and not simply on ‘economic behavior’...

When this happens, the work of economics becomes much more difficult: no longer monitoring the ‘economic behavior’ is enough to understand the well being of an individual or a collectivity, we need to go much deeper into aspects such as values (in a psychological and spiritual sense, not the material one), perceptions, psychological and sociological impacts of social changes, mental health and so forth. Layard articulates a very interesting overview of the topic writing about the roots, dynamics and effects of Buddhism, positive psychology and cognitive psychology in order to increase our sense of inner awareness. An awareness that too often is overshadowed by exterior and material aspects. For example, he points out that in the Western world depression has a very relevant impact at the social and productive level; yet only about one fifth of people with depression choose actively to cure it. Only physical illnesses take center stage. Layard reflections lead us to realize that learning to “know yourself” has not ‘just’ a philosophical or spiritual relevance, rather it is very relevant for our overall well being.

An ‘inner dimension’ that has a strong influence not only on individual well being but also on productivity...

What happens when we are working on something that we really enjoy, something that, no matter what kind of challenge we face, makes us feel satisfied, strong, empowered? It happens that we are able to give, almost effortlessly, the very best of our talents, experience and inner resources. The psychologist Mihaly Csiksentmihalyi has been studying and articulating this phenomenon during the last fifteen years naming it ‘Flow’. Layard makes reference to all of this and points out its value in terms not only of individual well being but also productivity, a kind of value that traditional economics totally neglects and, I add, not only economics but unfortunately also most part of management ‘science’ and ‘talk’ neglect it! (by the way, I strongly recommend the book “Flow. The psychology of Optimal Experience”). The author openly invites all of us to pay more attention to all of these ‘inner aspects’ and their relevance to the economic dimension. He also notes that the educational system has often marked responsibilities... for example in Britain the concept of “getting ahead” is the official core motivator of learning; he observes that this contributes to missing the point of learning and expressing the own talents: beginning with the educational system we should start to emphasize that satisfaction does not come from simply “getting ahead”, rather from doing something well expressing the very best of ourselves. This way the qualitative aspect of making (inclusive of the quality of our perceptions while ‘we make’) increases its value respect to the quantitative one; all of this almost appears rhetorical, but actually if this kind of ‘rhetoric’ would become integral part of our learning and doing we would have a revolution in the making!

So what? So we can fuel this revolution beginning with ourselves!...

Happiness as a ‘tool’ to measure individual and collective progress, development and well being, all of these factors made to sum up a stronger utilization of our potential... This is (it would be) a real revolution. A revolution not simply based upon philosophical or ethical aspects, rather based upon a pragmatic interaction with the real world: an interaction not oversimplified by statistics, numbers or traditional economic data (and this book effectively introduces us to this kind of perspective).

Do we want to try to fuel this revolution beginning with our work places? Here a pointer to start: when we select new hires or we interact with our colleagues to give and take feedback, let’s try to ask this ‘simple’ question: “what does make you happy?” . Please, let’s not accept ‘granted’ answers related to the ‘Gross National Product’ mind set... let’s not even fall into the false assumption that by asking that question “we will fuel unreachable expectations”. In fact, let ‘s not forget that the perception of happiness is strongly linked to the way we ‘frame’ a situation, therefore if we don’t learn to understand our way of ‘framing’ and other people way of ‘framing’, we will never be able to fully utilize tools and strategies that can have a real daily positive impact on us and on the people close to us.