Two Kinds of Happiness--and the the influence of inequality

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

What sort of happiness was Jefferson et al. referring to here?  We can be pretty sure what was meant by “life,” and while the contours of liberty are much discussed there is general agreement of its essential core.  But happiness?  What exactly is it?

Researchers who study these sorts of things generally distinguish two types of happiness.  There is “hedonic” happiness, that everyday contentment (and the vacuous cheeriness the term calls to mind in common American usage).  But there is also a broader sense of “life satisfaction,” judged by the criteria of “wellbeing” and “the good life”—Aristotle’s “meaningful life” (eudaimonia).  Surely, the founding fathers were referring to happiness in this older, classical sense of fulfillment (and one firmly embedded in the collective as well as the private good.)

While Easterlin and others have pointed out that income above a certain level does not seem to affect hedonic happiness proportionately, new research does show that income plays a big role in overall life satisfaction.  Research by Daniel Kahneman, Angus Deaton (mentioned below) and others show that income is positively correlated with overall life-satisfaction (“happiness” in the sense of fulfillment).  Di Tell and McCulloch (2008) find a positive correlation between happiness and “absolute income, the generosity of the welfare state and (weakly) with life expectancy; it is negatively correlated with the average number of hours worked, measures of environmental degradation (SOx emissions), crime, openness to trade, inflation and unemployment” in OEDC countries.

This makes sense: we adjust our daily expectations to what is “reasonable” for us and our circumstances, and adapt our happiness to that norm.  But when we look back (or forward) over the broad sweep of possibilities, of what was obtainable and what was not in terms of life paths, we are struck more by what could have been.  And the more income one has, the smaller the universe of what-could-have-beens.

As I have discussed previously, we must expand our notion of poverty out from just income.  As Amartya Sen argues, poverty is also about a lack of freedom, the lack of capabilities and power to chart one’s own life course.  And we must consider poverty in all of its multiple dimensions (as do Sabine Alkire and James Foster at the Oxford Poverty and Human Development Initiative).  This new work does remind us that we should not forget the importance of income—income allows greater degrees of self-determination (Sen’s freedom) that lead to greater overall life satisfaction. 

BUT: poverty is also always relational, and so poverty is felt more intensely in situations of great inequality.  Eduardo Porter, in his new book The Price of Everything, notes that inequality often reduces folks’ motivations.  In winner-take-all games, people are less likely to exert effort and more likely to cheat.  Some inequality is good and necessary—the hard working and deserving should be awarded as in our meritocratic ideals. But too much inequality reduces the sense of common purpose and ground rules and erodes the desire to succeed.