Here's an unusual term: Gross National Happiness. Economists are not about to replace Gross Domestic Product (GDP) with GNH anytime soon. Yet there is a growing tendency for economists to weigh more than GDP when considering the welfare of a nation and its people.
GDP measures the total output of goods and services a nation produces. But for rich nations to focus excessively on ways to raise the level, or growth, of GDP would be "a mistake," says economist David Blanchflower. That's because "money buys some degree of happiness, but not a lot," he says.
A far bigger contributor to happiness is marriage. A spouse provides as much extra happiness as $100,000 in new income, reckons Mr. Blanchflower, an economist at Dartmouth College in Hanover, N.H.
He and Andrew Oswald, an economist at Warwick University in Coventry, England, made this calculation by combing through large surveys of how people rate their own happiness. The key question: "Taken altogether, how would you say things are these days - would you say that you are very happy, pretty happy, or not too happy?"
On hearing that $100,000 number, one jester told Blanchflower, "I love my wife a lot. But how about if I trade her in and take the money?" He then added, "Just kidding!"
For several years now, a small group of academic economists have explored what gives people the most happiness.
While growth of GDP is still regarded as vital to overcome hunger and other miseries in extremely poor countries, "industrialized countries should ... use a broader conception of well-being than the height of a pile of dollars," Blanchflower and Oswald note in a National Bureau of Economic Research paper.
Other happiness research findings:
• Nations (at least those in the West) do not grow happier as they grow richer.
• Women report higher levels of well-being than do men.
• Two of the biggest negatives in life are unemployment and divorce.
• Better-educated people report higher levels of happiness, even after taking income into account.
• Comparisons matter. Reported well-being correlates to a person's wage relative to an average or "comparison" wage. Wage inequality depresses happiness in a region or nation. But the unhappiness impact of inequality is not large.
One other recent paper by the two economists entitled "Money, Sex. and Happiness," is getting a lot of attention because it spells out the sexual relations of Americans and their measured effect on happiness. Blanchflower describes the paper as an "incredibly moral" one that should please "the Pope."
That's because it finds, for instance, that those in a monogamous, faithful marriage are the happiest. In the dry language of the paper, "The happiness- maximizing number of sexual partners in the previous year is one."
Those who cheat on their spouses are less happy. Those who have ever paid for sex are much less happy than others. So are those who divorce.
So far, national economic policies do not seem to be much influenced by happiness studies. (Though President Bush's Healthy Marriage Initiative, with its combined goal of strengthening marriage and families and cutting welfare, might be viewed as a step in this direction.)
Happiness research is "enormously important" if it can be applied to policy, says Robert Frank, an economist at Cornell University in Ithaca, N.Y.
For example, since money doesn't buy much happiness, the nation could institute a steeply progressive consumption tax that taxes income (minus savings and investments), rather than the mildly progressive income tax we have, he says. That might discourage buying huge homes and yachts. It wouldn't discourage investment and it should encourage savings.
"It would stimulate growth," Mr. Frank says.
Revenues from the tax could be used to stimulate happiness - for example, by supporting public works and other government programs that make life easier and more fun for more people.
Laws could be passed, Frank also suggests, to shorten the workweek and provide longer holidays, giving workers more time with family and friends - activities that would promote GNH - that is, happiness.