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Can Government Spending Really Increase Happiness?

Research suggests it can—but the real answer is more complicated.
Public library

A new study suggests public goods like libraries make people happier.

In November, new research suggested the possibility of an Eden for urban planning: Appeasing citizens could be as simple as providing safe access to a public park. As Pacific Standard reported last month, the study in question found that people are happier in states that spend more on public goods such as libraries, highways, natural resources, and police protection.

Some readers, however, were skeptical of the report's results when they were publicly released this week. In a country with an ever-widening wealth disparity, these public goods are not evenly distributed, just like the income that pays for them.

Baylor University political scientist and study author Patrick Flavin accounted for this problem, issuing his own caveat. "It could be that happier citizens self-select by moving to states that spend comparatively more on public goods," he said. "It also is possible that happier citizens support higher spending on public goods and elect state officials to deliver on that policy."

Here, "happier citizens" could just as easily be "wealthier citizens." Money may not buy happiness, but a large body of research has found that poor people face significant mental health disparities.

While Flavin controls for the effects of income and location in his study, it's impossible to separate socioeconomic status from the benefits bestowed by public goods. Income taxes fund these goods, making those who pay even happier. But there's another way to look at it: People with more money, who have experienced firsthand the benefits of investing in public goods like parks and education, and who live in neighborhoods with higher property values, might also be more likely to support greater funding for these goods.

Moreover, not everyone lives in a state where governments are willing to spend as much on public goods. The country's biggest spenders often have a need, but the differences in funding also depend on socioeconomic factors. According to the Washington, D.C.-based social policy think tank Urban Institute, states with a small population spread over a longer distance (i.e. Alaska) and those with lots of traffic (Maryland) spend the most on highways. D.C. spends the most on parks, followed by states with a lot of national parks. And despite its low crime rate, New York spends the second most on police. Overall, Alaska, with one of the highest median household incomes in the country, spends the most per capita—but it's frequently ranked dismally low on lists of the happiest states.

So where does this happiness really come from? It's a question one study alone cannot answer, but others may provide more context:

  • Can you link happiness directly to public goods? The real effects are arguably more complicated, but there is plenty of research suggesting that parks and green space have tangible benefits: giving kids a cognitive advantage, bolstering mental health, reducing stress, fostering altruism in communities, and even reviving the spirit, through work done on the "Attention Restoration Theory." All of this might serve to make a person happier—but the effect is also linked to other socioeconomic advantages.
  • Disadvantaged communities of color often have limited access to green space, and, with it, these benefits. Historically, cities and states allowed industry to develop near these neighborhoods, away from the already healthier, and supposedly happier, upper class. This often comes with real, life-threatening consequences. For example, studies have shown that most of the industrial plants emitting carcinogenic toxins in New Orleans are located in the areas with the highest percentage of black people. Similar effects have been quantified with air pollution in Los Angeles, and across the country.
  • Parks and good schools require funding—but they also require good representation. In another study from 2011, Flavin found that "citizens with low incomes receive little substantive political representation (compared with more affluent citizens) in the policy decisions made by their state governments." This means that while people with fewer resources want the same amenities rich people do, their demands are often ignored.
  • Paying for experiences has been found to bring consumers more joy, compared to material possessions, an effect known as the "experiential advantage." But a 2018 study published in Psychological Science found that this effect only holds for the wealthy. People with more resources can devote money and time to concerts or movies, while lower class people are happiest purchasing things that have "practical benefit, resale value, and are physically longer lasting," the researchers wrote. The experiences they measured were not as lofty as school tuition, but the fact remains: When you have less to spend, it's harder—and can feel less rewarding—to pay for things that provide long-term benefit.