Is economic development the key to national happiness? Once nations have covered the bases for most of their citizens — checking off the basic necessities of food, water, shelter and safety — what is left? Do we stop measuring success by our GDP and tell government to stop pursuing happiness and focus on its capture, á la Bhutan?
A standard government response to such mandates might be to ladle out cash, but recent research suggests more money alone doesn't make us happy — what makes us happy is having more than our neighbors. So with Western nations having established an economic pecking order since World War II, perhaps it's no surprise to see studies that find no net increase in European or American happiness over the last half century.
This "Easterlin paradox" argued that richer people within a country are happier, but as a developed country itself grows richer, there is no corresponding aggregate increase in happiness.
But a group of researchers, citing data from 1981 to 2007, says that's not true, and that happiness rose in 45 of the 52 countries for which extensive data was available, including the U.S., Japan, Spain, France, Germany and Britain.
Furthermore, the cause wasn't income but freedom.
In the researchers' words, "Since 1981, economic development, democratization, and increasing social tolerance have increased the extent to which people perceive that they have free choice, which in turn has led to higher levels of happiness around the world."
Economic development doesn't just mean a bigger wallet; it also furthers happiness through increased freedom, opportunities and equality, argue Ronald Inglehart and Christopher Peterson of the University of Michigan, Robert Foa of Harvard University and Christian Welzel of Jacobs University in Bremen, Germany.
They correlated happiness and freedom data from the World Values Survey and European Values Study, representing almost 90 percent of the world's population. Interestingly enough, the data ends in the year of the financial crisis, right on top of the bubble of American and European economic success.
The team credits increased freedoms and equality, not more material goods, for the rise in happiness. Perhaps the movement away from pursuing a larger piggy bank is already under way as people seek more balanced lives, self-expression and utilizing free choice.
The authors speak of the transition, that once economic prosperity has been reached, people emphasize "quality of life concerns rather than continue the inflexible pursuit of economic growth,"; further economic growth brings minimal gains to subjective well-being. Beyond survival, people focus on a "broader pursuit of happiness by maximizing free choice in all realms of life. The belief that one has the free choice and control over one's life is closely linked with happiness."
But it isn't a matter of just distinguishing freedom from economic status for the two are reciprocal; income increases freedom. Increased economic muscle doesn't just entail a four-car garage. It also means more freedom to pursue what makes us happy.