Governments around the world have been wrestling with attempts to use data on people’s happiness to shape policy and public spending decisions, but they have been missing a crucial step according to new research by University of Warwick economist Professor Andrew Oswald and former Cabinet Secretary Lord (Gus) O’Donnell.

Governments need to ask people which human feelings matter most, rather than assuming what’s important to individuals, they say.

The authors examine recent Office of National Statistics data on UK citizens’ feelings of happiness, satisfaction, worthwhileness, and anxiety. Then the authors collect the views of hundreds of members of the public, MBA students, undergraduates and professional economists – and ask which feelings should matter most in a society. Overall, the target of high life satisfaction is seen by people as the most important. The least weight is put on concern about the level of anxiety.

Lord O’Donnell says “As a society evolves, it is vital to allow the concept of success also to evolve. Gross Domestic Product is no longer an adequate measure.”

“A new kind of economics of feelings is emerging.” says Professor Oswald. “We can, as a nation, design policy that aims to reduce anxiety or raise happiness or raise worthwhileness of life. But which emotional priorities should be pursued in a society? Let’s allow citizens to decide.”

For many years, GDP has been the focal piece of data for governments deciding economic and social policy. In their new paper, entitled “National Well-being Policy and a Weighted Approach to Human Feelings”, to be published later this year in the academic journal Ecological Economics, the University of Warwick-led research team points out that eighty years ago Simon Kuznets, pioneer in the measurement of Gross Domestic Product, himself stated that human welfare could not be captured by GDP. They also say that in recent years many governments have accepted this view but have been struggling with how to deal with subjective data.

There are now large data sets that question people on how happy they are by some quantification. Measures include levels of: satisfaction, worry/anxiety, sense of worth, or intrinsic happiness. Yet the problem is that no one knows which of these measures is the best one, or if it is possible to find a best hierarchy for each of these states to inform policy decisions.

As University of Warwick economist Professor Andrew Oswald puts it:

“The difficulty is of deciding how the social-importance weights on each ‘feeling’ are to be decided. Our research is the first to ask: how for policy purposes could the weighting values required for each of these subjective variables be calculated? Our answer: do it democratically.”

After mathematically modelling a number of ways of devising such a hierarchy of weightings, the researchers came to the conclusion that the most effective way of deciding this was to ask the population what they considered to be most important. If policy-makers are prepared to trust the subjective data obtained from responses to how happy or worried people are, the authors argue, governments should place the same trust in the public to decide on the weighting of different human feelings.

The authors’ paper is downloadable from www.andrewoswald.com.

Sir Gus O’Donnell and Professor Andrew Oswald will be discussing their findings at the University of Warwick’s Festival of the Imagination this weekend. On Saturday (17 October) they will be ‘Quantifying Happy’ – explaining why our smiles say more about our nation’s prospects than GDP. For more information visit: www.warwick.ac.uk/warwick50.

Notes to Editors:

Pictured: Professor Andrew Oswald.

Contact Lee Page, Communications Manager, Press and Policy Office, The University of Warwick. Tel: +44 (0)2476 574 255, Mob: +44 (0)7920 531 221. Email: l.page@warwick.ac.uk or Peter Dunn, Director of Press and Policy, University of Warwick Tel: +44 (0)2476 523 708, Mob: +44 (0) 7767 655 860. Email: p.j.dunn@warwick.ac.uk.

Technical Note:

The authors ask the following question of respondents.

QUESTION “The UK government is collecting information on… happiness, satisfaction with life, how worthwhile life is, and people’s anxiety. We would like to know your view on the relative importance of these for assessing how well a society is doing.

We would like you to imagine that you have 100 points to allocate as an indication of the importance of measures of well-being. How would you personally allocate the 100 points across the four measures...”

Contacts:

Peter Dunn, Director of Press and Policy, University of Warwick

+44 (0)2476 523 708

+44 (0)7767 655 860

p.j.dunn@warwick.ac.uk

Lee Page, Communications Manager, University of Warwick

+44 (0)2476 574 255

+44 (0)7920 531 221

l.page@warwick.ac.uk

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