Stephen Monrad

I heard Professor John Helliwell speak last night at the Walter Gordon Massey Symposium in Toronto. The symposium was about rising inequality. Professor Helliwell’s main point was that we shouldn’t be too worried about income inequality. What we need to focus on is happiness inequality.

He talked about the research that is being done by psychologists and behavioural economists that shows that more stuff doesn’t make people happier once people are able to take care of their basic needs reliably. What people need to be happy is control over their lives and the ability to contribute to their community. This falls in line with the book I mentioned, Stumbling on Happiness, in my January 29, 2009 post.

I thought more about why wealth doesn’t bring happiness. I think the reason wealth doesn’t increase happiness is because many simple and cheap activities are just as pleasurable as expensive ones. It might be very nice to go out for a sail on an expensive yacht. The activity, however, isn’t really all that much different than hanging out at a beach playing Frisbee. Both are social activities requiring skill that are done outdoors. The main difference is that one needs a boat costing tens of thousands of dollars while the other needs only a piece of plastic costing a few dollars. If you don’t like Frisbee, there are plenty of other similarly cheap activities that you can take up. All that is needed is a little imagination and like minded friends.

If expensive and cheap passtimes are equally enjoyable, why do we choose the expensive ones? It could be for increased status. It could be because we simply don’t realize that cheaper activities are just as much fun. Either way, it seems likely that first world standards of living could be cut back dramatically without making people much worse off. This is good news with the current economic downturn and looming environmental problems.