Relationships and good health the key to happiness, not income
From an article by LSE
At a conference in London in December 2016 organised by the OECD, the London School of Economics, and the CEPREMAP Wellbeing Observatory of the Paris School of Economics, Lord Richard Layard and his LSE team presented for the first time the results of their study of the Origins of Happiness, analysing survey data from four countries.
They found that most human misery is due not to economic factors but to failed relationships and physical and mental illness. Eliminating depression and anxiety would reduce misery by 20% while eliminating poverty would reduce it by 5%. And on top of that, reducing mental illness would involve no net cost to the public purse.
Among the findings on the key determinants of people’s life satisfaction:
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Income inequality explains only 1% of the variation in happiness in the community, while mental health differences explain over 4%. Education has a very small effect on life satisfaction, compared with, for example, having a partner.
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When people evaluate their income or education, they generally measure it against the locally prevailing norm. As a result, overall increases in income or education have little effect on the overall happiness of the population: if my relative income rises, someone else’s must fall, and the average is unchanged. This helps to explain why in Australia, Britain, Germany and the United States, average happiness has failed to rise since records began, despite massive increases in living standards.
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The strongest factor predicting a happy adult life is not children’s qualifications but their emotional health. There is also powerful evidence that schools have a big impact on children’s emotional health, and which school a child goes to will affect their emotional wellbeing as much as it affects their exam performance.
Lord Layard said. “The evidence shows that the things that matter most for our happiness and for our misery are our social relationships and our mental and physical health. This demands a new role for the state – not ‘wealth creation’ but ‘wellbeing creation’. In the past, the state has successively taken on poverty, unemployment, education and physical health. But equally important now are domestic violence, alcoholism, depression and anxiety conditions, alienated youth, exam-mania and much else. These should become centre stage."
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from an article by LSE, 09/01/2017