Maximising Happiness?

Institute for Empirical Research in Economics Working Paper No. 22

24 Pages Posted: 11 Jan 2000

See all articles by Bruno S. Frey

Bruno S. Frey

CREMA; University of Basel

Alois Stutzer

University of Basel - Faculty of Business and Economics; IZA Institute of Labor Economics

Date Written: October 1999

Abstract

The measurement of individual happiness challenges the notion that revealed preferences only reliably and empirically reflect individual utility. Reported subjective well-being is a broader concept than traditional decision utility; it also includes concepts like experience and procedural utility. Micro- and macroeconometric happiness functions offer new insights on determinants of life satisfaction. However, one should not leap to the conclusion that happiness should be maximised, as was suggested for social welfare function maximisation. In contrast, happiness research strengthens the validity of an institutional approach, such as reflected in the theory of democratic economic policy.

JEL Classification: D60, D71, I31

Suggested Citation

Frey, Bruno S. and Stutzer, Alois, Maximising Happiness? (October 1999). Institute for Empirical Research in Economics Working Paper No. 22. Available at SSRN: https://ssrn.com/abstract=203311 or http://dx.doi.org/10.2139/ssrn.203311

Bruno S. Frey

CREMA ( email )

Südstrasse 11
Zurich, CH 8008
Switzerland
+41 44 380 00 78 (Phone)

University of Basel ( email )

Peter Merian-Weg 6
Basel, 4002
Switzerland

Alois Stutzer (Contact Author)

University of Basel - Faculty of Business and Economics ( email )

Peter Merian-Weg 6
4002 Basel
Switzerland
0041 61 267 3361 (Phone)
0041 61 267 3340 (Fax)

HOME PAGE: http://www.wwz.unibas.ch/stutzer/

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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