Anderson School of Management; USC, Center for Economic and Social Research (CESR); National Bureau of Economic Research (NBER); Human Genetics Department, David Geffen School of Medicine
Cornell University - S.C. Johnson Graduate School of Management; The Hebrew University of Jerusalem - Department of Economics and Center for Rationality; National Bureau of Economic Research (NBER)
University of Colorado Boulder; University of Michigan at Ann Arbor - Department of Economics; Center for Economic and Social Research, USC; National Bureau of Economic Research (NBER)
Cornell University - Department of Economics; National Bureau of Economic Research (NBER)
Date Written: October 2010
Abstract
Are subjective well-being (SWB) measures a good empirical proxy for utility? We evaluate one necessary assumption: that people's preferences coincide with what they predict will maximize their SWB. Our method is to present survey respondents with hypothetical scenarios and elicit both choice and predicted SWB rankings of two alternatives. While choice and predicted SWB rankings usually coincide, we find systematic reversals. Furthermore, we identify factors--such as predicted sense of purpose, control over one's life, family happiness, and social status--that help explain choice controlling for predicted SWB. We explore how our findings vary with the SWB measure and the choice situation.
Benjamin, Daniel J. and Benjamin, Daniel J. and Heffetz, Ori and Kimball, Miles S. and Rees-Jones, Alex, Do People Seek to Maximize Happiness? Evidence from New Surveys (October 2010). NBER Working Paper No. w16489, Available at SSRN: https://ssrn.com/abstract=1696401
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