More economics, some more happiness

I have now finished the Layard book, Happiness, Lessons from a New Science. It was a lot less economics-based than I thought it would be. There are some graphs, and a few tables, but no really complicated regression equations, eigen values, r squareds or anything. It's actually very readable - the tone is kindly uncle, somewhere between helpful and patronising (my favourite sentence might well be "The most famous anti depressant is Prozac, which has been taken by millions who suffer from depression, including Princess Diana". No! Actually, I've changed my mind. This is my favourite; "Buddhists, such as the Dalai Lama..". What about Richard Gere?).

The book makes some very imoprtant points, not least that happiness is real and measurable. Scans of the brain show activity in speciific areas (the left hand side in particular) when we are happy. There are reliable questionaires that can help us measure happiness over time and even across countries. The same things - family, finance, community and so on - tend to make people happy. All of which means that happiness cannot be dismissed as an undefinable, wishy washy concept that means unquantifiably many different things to different people. Which is a relief.

A couple of things, then. He frequently repeats two things in the book - firstly, that an additional pound gives more happiness to a poor person than to a rich person. This is fairly standard GCSE economics. Secondly, when it comes to happiness, relative wealth matters more than absolute wealth. If I get a £100 pay rise and you get a £200 pay rise, that makes me unhappy, even though I am by and large quite well adjusted and not running on a cocktail of spite and envy. So, it seems to me that reducing overall inequality via some sort of redistribution would be a valid policy goal. He is never explicit about this, though he does have some kins things to say on redistributive taxation and the potential for taxes to prevent overwork.

Connected but different, is his assertion that money spent on alleviating poverty would be better spent on better mental health. Why should it be one or the other? Poor people are more likely to suffer from mental illness - true across all ages, children , adults and older people - so, wouldn't alleviating poverty reduce the prevalence of mental heatlh problems?

Layard makes a series of policy recommendations (including tackling poverty, though mainly overseas). He steers clear of any redommendations regarding taxes or benefits. I'll do it instead. A more equal society would be a happier one. So we should put up taxes on the highest paid and increase wages and benefits to the poorest. Easy. Next.