Abstract

http://ssrn.com/abstract=2222923
 
 

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Characterizing the Choice Environment: Feeling Constrained as an Impediment to Happiness


Katherine Guthrie


College of William and Mary - Mason School of Business

Jan Sokolowsky


Independent

February 22, 2013

International Journal of Happiness and Development, Vol. 1, No. 3, pp. 261–273, 2013

Abstract:     
We posit that feeling constrained impedes happiness. Under this view, utility and happiness maximization yield the same optimal choices in a variety of standard economic decision problems, but utility and happiness can move in opposite directions in response to exogenous shocks. Our theory (i) respects economists' and psychologists' notions of utility and happiness; (ii) captures why the two concepts are often confused; (iii) explains the Easterlin Paradox and hedonic adaptation without resorting to systematically poor choices; and (iv) offers a novel interpretation of previous empirical findings in which individuals' choices go hand-in-hand with lower happiness.

Number of Pages in PDF File: 19

Keywords: behavioral choice, constraint, contentment, decision theory, happiness, rational choice, satisfaction, shadow value, utility, welfare, well-being

JEL Classification: A10, A12, D11, D60, E21, I31, J22, O40

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Date posted: February 24, 2013 ; Last revised: December 1, 2013

Suggested Citation

Guthrie, Katherine and Sokolowsky, Jan, Characterizing the Choice Environment: Feeling Constrained as an Impediment to Happiness (February 22, 2013). International Journal of Happiness and Development, Vol. 1, No. 3, pp. 261–273, 2013. Available at SSRN: http://ssrn.com/abstract=2222923 or http://dx.doi.org/10.2139/ssrn.2222923

Contact Information

Katherine Guthrie
College of William and Mary - Mason School of Business ( email )
P.O. Box 8795
Williamsburg, VA 23187-8795
United States
7572212832 (Phone)
Jan Sokolowsky (Contact Author)
Independent ( email )
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