Spreading Happiness

A recent study from Harvard and the University of California shows how an individuals happiness increases the happiness of those around him/her in up to three degrees of separation. If you haven't heard about this, then you can read about it here or listen to a 60-second science podcast. Basically, this study provides a scientific founding for something that I've always known: When I smile, the people around me are more likely to smile and vice-versa!

The contagiousness of happiness is an important point to consider, because it gives credence to the idea that we benefit selfishly by giving to others. It is in our own self-interest to ensure the happiness of those around us, be they family, friends, or unknown neighbours. No man or woman is an island, and I am clearly impacted by the actions and attitudes of others. In the same way, I need to be aware of what emotions I am projecting and realize that a positive vibe will likely result in happier people around me!

Although obviously relevant for individuals' decision-making, this study is even more important for a macroeconomic discussion of governmental objectives. Conventionally, governments aim for economic growth in the form of higher GDP. This priority is clear from the importance of money in our lives, and the place of prominence that Finance/Commerce Departments and Ministries have in any country's governmental power hierarchy. Unlike happiness, money is not contagious. In fact, the flows of money show that it tends to concentrate in the hands of the few, as if there were a 'trickle-up' effect (see here and here for proof). Therefore, our governments' efforts to increase monetary wealth have primarily resulted in the rich getting richer. If governments really want to 'raise all boats' to prosperity, then it should focus on something positive that will self-perpetuate. Several regions (most noticeably the countries of Thailand and Bhutan) have embraced happiness as the ultimate end social well-being. They employ measures like Happy Planet Index, Gross National Happiness, and Genuine Progress Indicator to provide guidance and quantify success.

Accepting happiness as a economic strategy recognizes that having money alone does not constitute a high quality of life. Instead, societies must strike a balance between the connected spheres of profit, people and planet. By measuring and encouraging the growth of human capital, social capital and natural capital in conjunction with financial and manufactured capital, we get a more robust form of economic development that is more sustainable.

Don't worry, be happy!