07 Jan The Economics of happiness
ECONOMICS is “not a gay science”, wrote Thomas Carlyle in 1849. No, it is “a dreary, desolate, and indeed quite abject and distressing one; what we might call, by way of eminence, the dismal science”.
But in recent years, economists have become newly confident that they can measure utility (a form of happiness) as Bentham conceived it: as a quantum of pleasure or pain.
How do they do it? Mostly, they just ask people. Daniel Kahneman, a psychologist at Princeton University who won the Nobel prize for economics in 2002, reckons people are not as mysterious as economists supposed.
“The view that hedonic (happiness) states cannot be measured because they are private events is widely held but incorrect,” he and his colleagues argue. Generally, people can say how they feel at a given moment, on a scale of zero to 10.