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Frey and Kahneman examine economics of happiness

by Brian Kirk
The perception that making more money will increase long-term happiness is false, according to University of Zurich economist Bruno Frey, who joined Nobel laureate Daniel Kahneman of Princeton for a lecture on happiness studies Tuesday, Oct. 7.  

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Frey, whose books include "Happiness and Economics: How the Economy and Institutions Affect Human Well-Being," said preliminary results of a study have shown that long-term happiness is fairly constant and is not drastically affected by increases in income.

In his address in Roberston Hall, titled "What Can Economists Say About Happiness?" Frey also discussed other factors that have been found to affect happiness, such as direct democratic rights and higher levels of education -- which, he said, refutes the maxim that "only fools are happy."

He also explained that happiness varies strongly from country to country, and that his demographic and economic research points to evidence that happiness can be measured simply by asking people to rank their well-being on a scale of one to 10.

In his response to Frey's comments, Kahneman argued that there may be more than external economic and regional influences at work. He suggested that explanations for happiness may exist in the physiological workings of the body, and further research into neuroscience and general health will shed more light on their relationshop to life satisfaction.

Kahneman is the Eugene Higgins Professor of Psychology and professor of public affairs in the Woodrow Wilson School of Public and International Affairs. He won the 2002 Nobel Prize in economic sciences for his pioneering integration of psychological research about decision-making into economics.

The talk was sponsored by the Department of Economics, the Center for Arts and Cultural Policy Studies and the Center for Health and Wellbeing.

 

Kahneman and Frey
Nobel laureate Daniel Kahneman of Princeton (left) and economist Bruno Frey of the University of Zurich discussed the economics of happiness in Robertson Hall on Tuesday.

photo: Denise Applewhite