Clive Hamilton has set up a new website advocating a wellbeing manifesto. The general argument, as you’d expect from Clive, is that we should focus less on material wealth and use the benefits of economic growth (which I’d interpret in this context as technological progress rather than increased output) to deliver more desirable benefits, such as increases in leisure, better education and improvements in the environment. You can endorse the manifesto if you want and quite a few prominent people have done so .
I’m in general agreement with the ideas set out in the manifesto, though I’m taking my time to think about it before I decide whether to sign. On a quick reading the manifesto seems to capture a lot of points on which Clive and I agree, and omit some of those on which we’ve disagreed (we agree more than we disagree, but not on everything).
John Quiggin 
‘Tom posits a utility function such that one’s happiness will be increased by reductions in the material wealth of others, regardless of their current wealth relative to your own.’
Yes, but I think it’s fair to assume that the magnitude, as opposed to the sign, of this effect, does depend on the relative wealth. In fact what bothers us, if Alain de Botton is right, is not what happens at the extremes (a bum gets fifty dollars, Kerry Packer makes another fifty million), but when our substantive equals do better.
I didn’t measn to suggest that habituation (is that the same as habit-formation) and the Joneses weren’t distinct. As to amputating arms, you would need to show that some concrete benefit could come from this policy before I could see it as useful analogy. The concrete benefit from reduced income is more time for leisure (broadly interpreteted).
I’m afraid I didn’t quite grasp the point in the penultimate paragraph. Unless you were saying that you never got used to being poor as a student. But that might be becasue you were relatively poor, but that’s why we need to take account account of the Joneses as well.
In the final paragraph you disagree with my characterisation of the manifesto. Well, I don’t know whether the thesis about wealth and happiness underlies 30 percent or 70% of the manifisto, but Clive’s allusion (above) to Layard’s book suggests it’s a strong influence. You are right to be wary of the claims of ‘happiness science’, but do you want treat them as self-evident nonsense?
Should have mentioned that the above is addressed to Paul. When’s the comment preview coming back, by the way, John? Notwithstanding there are a few raving lunatics who claim not to like it, I rely on it heavily.
James, when I get a bit of time (hah!) I’ll give it another test run. Soon, I hope.
Clive Hamilton, on balance I think there was more mileage in the GPI.
James:
Your point about magnitudes sounds perfectly correct and accords with my intuitions, but doesn’t alter my claim about terminology.
To recap – a thing properly called “preference for equality” should in my opinion reduce utility in response to absolute differences in income, while being neutral as to their direction. That is: if I am richer than you and you become poorer then I ought to become less happy.
A thing properly called “envy” might exhibit similar effects, but their direction would be different, in that it would value negative differences in relative wealth negatively, but positive differences in wealth positively. That is: If I am envious and you become poorer I should feel happier, as I am now relatively richer.
Tom’s model, your challenge to Razor and empirical research on the effects of relative wealth all suggest that the second interpretation is correct and that therefore we are talking about “envy”, not “a preference for equality”.
Let me amplify the subjective happiness based case for amputation, which I grant sounds a bit odd until I’ve made it. Research suggests that long term happiness levels are more or less unchanged by most shocks, even those which have long term effects (like a permanent rise in consumption, or, in this case, a permanent disability below a certain threshold). All we need to do is posit some minor benefit from arm amputation – reduced food consumption perhaps, or using the arms as compost – and I can demonstrate that, because happiness levels will be unchanged in the long term, a coercive policy of arm removal is quite justified. I could even write a book, titled “arm fetish” lamenting society’s refusal to adopt my proposal, and perhaps follow it up with a manifesto.
It follows generally then that I think subjective happiness research is both fascinating and valuable, but that anyone using it to urge the pursuit of specific goals at this early stage is a charlatan.
The reference to time at university was intended to illustrate my general point, that one becomes habituated to leisure in much the same way as consumption – it was a joke and probably a weak one. In any case, if you accept that general point that leisure and consumption operate the same way under the utility functions you and Tom posit then the idea of taxing consumption to encourage an efficient shift to leisure falls apart.
Finally, I think the problem with the manifesto, and Hamilton’s work generally, is that there is only a weak relationship between his proven starting points and the policies (or direction of moral suasion, depending on who one is arguing with) he urges. Rather, I’d suggest that Hamilton presents a grab-bag deliberately designed to reflect the beliefs and/or prejudices of certain parts of society – it’s dog whistle politics where Hamilton relies on his audience to lazily connect a reduced demand for I-Pods and Hugo Boss suits with an overarching dustbowl prvention strategy.
Paul
I haven’t had time to answer work out a response to this, but thought I should say I appreciate the detailed reply before the thread vanishes.
The equality/envy/externality thing is proving too slippery for my little brain. I’ll come back to it another day.
But as for limbs, is there really evidence that people get used to the losing them? I’m sure there’s a partial recovery and acceptance, but a return to baseline? I find this hard to swallow, and I guess my arguments stem from a faith that the utility derived from leisure (relationships, play) is more like that derived from limbs and less like the utility from gadgets and five star hotels. Something to do with my good old ‘species being’. It’s an essentialist view which may or may not be confirmed in detail by evolutionary psychology (I hope to God Jack Strocchi isn’t reading this). In the meantime, some crude empirical confirmation is emerging, and it makes sense to formulate a program that recognises this, especially when the goals coincide with environmental ones as well.
Thanks James. Any follow up would be appreciated but I think it’s done me good to formulate some of these ideas.
As for the arms, and general comments on the relaibility of subjective wellbeing research:
There is pretty robust evidence that most humans have a baseline happiness level to which they eventually return after almost any shock. Arm removal may stretch the boundaries of this propositon, though I suspect it’s safely covered by it. In any case, replace “arm” with “finger” or possibly “hand” and you have a pretty indisputable, though obviously ridiculous proposition based on theories of subjective wellbeing.
Now obviously there are hundreds of daily inconveniences and even barriers faced by someone who is (absolutely) poor or disabled which we would recognise as costs in any sensible utilitarian calculus, but they simply don’t show up in reported measures of subjective happiness. In fact real poverty does a much better job of getting people to permanently lower their reported wellbeing than anything outside the loss of intimate relationships.
A more general observation on subjective wellbeing is that the numbers just aren’t all that good: Danes are, according to one survey, five times happier on average than Italians, and I could presumably subject you to dozens of minor difficulties throughout the course of a year without altering your answers in a “how happy would you say you are” type survey.
It’s possible than the consequence of constant happiness baselines is that we need to view increases in material standards of living as a tranistory rather than permanent gains – and that’s an important observation with real relevance to environmental cost-benefit analysis.
Finally I think there’s something in your leisure/luxury distinction, in that we typically “consume” additional units of leisure rather than the kind of “upgrading” we often do with additional expenditure on consumer goods. That provides a basis for suggesting that providing incentives to trade (certain types) of consumption for leisure might be welfare enhancing, though, ironically, subjective wellbeing surveys with their constant long term baselines would probably reject this conclusion.
Alot of people seem to focus on the minutae of the document without seeing at all, the larger picture. The idea is not to force a 35 hour week nor for government to force any issue. The whole idea of the manifesto is for government to move from a decision making system based on economic growth to a system that is based on the well being of its citizens. If you want to work 100 hours a week then good for you but don’t bend over backwards to moan over a point while missing by a mile the manifesto’s general idea. I dont’ know how anyone could possibly say that the goals of economic gowth should come ahead of the happiness of the people that drive that economy, which isn’t the government but all of us. So read it again and you may see its message, the simple basis of which is, “..that government’s primary responsibility should not be to grow the economy…” this does not mean don’t grow the economy or forget about the economy, it means to put ahead of the economy the values of citizenship, happiness, communication and hence “Well Being”.
That’s pretty much position, Tristan, but the discussion with Paul will help me to develop a more rigorous position. And I’ll be much more relaxed in future when anyone treatens to rip my bloody arms off.