Subjective Well-being and Public Policy

Abstract

(This paper gives an overview of the idea of subjective well-being which has captured the attention of economists in the last one decade or so. The gist of the literature which has emerged on the subject is that income or GDP does not truly reflect human welfare and there is need to make use of interdisciplinary knowledge to develop a new metrics to measure it. Plausible explanations of income-happiness paradox are presented besides shedding light on the shortcomings of GDP as a yardstick of development. The determinants and building blocks of happiness, both at individual and societal level, are discussed and public policy prescriptions, in the light of lessons drawn from the World Happiness Reports, are prescribed for enhancing subjective well-being of the people with particular reference to Pakistan – Author).

Setting the stage

Research shows that objective well-being, approximated by income, does not necessarily correspond to subjective well-being. The revealed preferences i.e. the actual choices and decisions of the people may be inconsistent due to bounded rationality, so objective well-being is not a true reflection of people’s happiness. A study¹ of 2001 examined data of 17 developing countries in Latin America and observed no obvious relationship between GNP per capita and happiness. Another study² conducted in 2009, which covered developed, developing as well as transition economies, also found no significant relationship between improvement in happiness and the long-term growth of per capita GDP. The researchers of this study argue that at least three countries i.e. China, Chile, and South Korea, included in their sample of 37 countries have shown high growth rates in the recent past. China’s growth rate implies a doubling of real income in less than 10 years, South Korea’s in 13 years, and Chile’s in 18 years. With such high increases in per capita amount of goods in a short span of time, one might expect people ‘dancing in the streets’ in ecstasy but results suggest that this is not the case as no significant increase in levels of happiness in the citizens of the said countries has been observed.

The idea of subjective well-being is now being advocated by some leading development economists as the ultimate objective of public policies. Several countries are exploring ways to embed happiness into public policies of the country. For example, the national policy³ of Bhutan emphasizes that people’s happiness should be the prime objective of all public policies and legislation. Every piece of public policy or legislation must pass the litmus test of whether it is happiness- enhancing. Gross national happiness (GNH) rather than GDP is taken as a measure of development in Bhutan since the last one decade or so. The concept of GNH has been used to guide public policy making for the country’s various 5-year plans. It was on the initiative of Bhutan that the UN General Assembly unanimously passed a resolution to recognize the pursuit of happiness as a fundamental human goal. The resolution also noted that the goal of pursuing happiness was not reflected in GDP. In 2008, Mr. Sarkozy, the then President of France, appointed a commission comprising of three economists—Joseph Stiglitz, Amartya Sen (both Nobel Laureates) and Jean-Paul Fitoussi—with the mandate to analyze the limitations of current indicators of well-being and assess the feasibility of alternative measurement tools of social progress⁴. The resulting report of the commission rejected reliance on production- oriented measures of progress in favour of a broad array of quality of life indicators.

The key message of the report was that a multi-dimensional definition of well-being is required which takes into account both material and non-material factors as both objective and subjective dimensions of well-being are important. The report emphasized that policy decisions and welfare evaluations should use multiple dimensions of well-being. A growing interest in the theme of happiness is expected to reorient policies of states towards subjective well-being in the coming years and decades. The economics of happiness may be an anathema to hard-core economists due to an element of subjectivity but perhaps time is not far away when this idea gains wider currency among the economists and policy makers and the concept of utility does not remain confined to material things. The pursuit of happiness has always remained an objective with humans throughout history but in economics the idea of happiness in modern times seized attention of researchers due to ‘Easterlin paradox’.

Income-Happiness Paradox

The ‘Easterlin paradox’ or income-happiness paradox simply questions the relationship between income and happiness as generally perceived. Richard Easterlin studied statistics over time on the reported level of happiness in USA. The results were startling which suggested that richer individuals were happier than poorer ones but over time society was not happier as riches grew⁵. How can the Easterlin Paradox be explained? Why do people not attain happiness as they get wealthier? One plausible explanation perhaps is that peoples’ happiness depends less on their absolute wealth than on relative wealth. Individuals compare themselves to others. They are happier when they are comparatively higher on the social or income ladder. A second explanation is uneven distribution of gains from economic growth and riches which have disproportionately been captured by the top 1%, thus making the majority of 99 %, who did not share the gains of growth, unhappy. A third explanation of ‘Easterlin paradox’ lies in societal factors. Insecurity, bad governance, low social trust, etc. might have nullified the gains of growth and riches. The fourth possible factor may be adaptation. When income rises, people initially feel elevated levels of happiness which eventually revert to their original levels. Moreover, income levels matter to a certain point, particularly when basic needs are unmet, after which relative income differences matter more and diminishing returns to income set in.

Comparisons and relative incomes matter. This point is not a new one. Pigou, more than a century back, in 1920, justified redistributive taxation on the ground that satisfaction would not be reduced if incomes of all the rich were diminished at the same time because the rich derived pleasure from relative rather than absolute income⁶. So, the point is that perceived equity in distribution of income or rewards may matter as much to people’s happiness as the income and rewards themselves. It implies that if relative inequalities are less sharp, the general level of happiness of a society will be higher. Observation also vindicates this point. For example, Scandinavian countries sit at the top in terms of indicators like longevity of life due to social and economic equities. In Pakistan, Hunza valley has remained a point of attention for the researchers as the inhabitants of Hunza enjoy more longevity compared to other Pakistanis. Homogeneity and uniformity in living standards, status, income, etc. are some possible reasons for their comparatively long lives as they live in peace with little chance of psychosomatic diseases and are not emotionally stressed due to homogeneity and equality⁷.

The Indian state, Kerala, is another case in point where a fairly reasonable level of well-being was achieved with relatively low per capita income. Public policies for food provision, health services, education and social security were instrumental in achieving better levels of well- being with comparatively low income levels⁸. State politics dominated by the leftist parties played a critical role in the development of a social security system that became the basis for improvement in the well-being of the people. The state of Kerala is said to have attained a level of social well-being said to be comparable to advanced countries and cited in literature as an example of ‘welfare by public intervention’. According to Amartya Sen, the Kerala Model of development vindicates the point that economic growth is not good per se, but it is a route for achieving human development⁹. While drawing comparison with Gujarat, Sen says that if we look at median per capita income rather than average income, then Kerala fares better than Gujarat. The percentage of people living below the poverty line, on the 2004-05 scale, in Kerala was 19.4% while for Gujarat, this figure was 31.6%. Similarly, on other human indicators such as female literacy, percentage of child undernourishment, under 5 mortalities, etc. Kerala fares much better than Gujarat.

Undoubtedly, importance of income cannot be downplayed, however, the possibility of better well-being exists in lower-income countries. The traditional discourse on development equated people with consumers and well-being with purchasing power. There is a need to revisit this discourse. The development paradigm needs to embrace factors in addition to income for better assessment of people’s well- being. For example, Latin Americans report a high level of happiness in comparison to their income levels. Factors like warmth, genuineness, and person-based interpersonal relations contribute to their happiness but development discourse has neglected inter-personal relations in favour of instrumental ones which may have a larger impact on economic growth but not on people’s happiness¹⁰. The income-happiness paradox implies that there is need to go beyond income for enhancing subjective well- being. We need to identify policies, processes and barriers that lower our happiness. Public policies which promote community cohesion and civic engagement are required to enhance subjective well-being. Subjective well-being has also got cultural and social context. In this context, a commission on subjective well-being comprising of experts from the disciplines of economics, psychology, sociology, and cultural studies may be a good idea to begin with. This commission should identify factors which are reducing subjective well-being and should provide recommendations for preparing a national happiness index.

Happiness Correlates and Equations

Individual factors also matter for subjective well-being. At an individual level, heritability of happiness has been discussed in literature as one of the major determinants. In this regard, literature on subjective well-being finds mention of a study published in 1996 on identical twins¹¹. A study of birth-record-based samples of several thousands of middle-aged twins found that heritability or genes explain 44% to 52 % of variances in the subjective well-being of an individual. Circumstances of an individual also impact subjective well-being. The range varies. The circumstances, good or bad, make up as little as 10% or as high as 40% of the subjective well-being. It is, however, argued that circumstances are not permanent, therefore, neither are their effects.

In this regard, a classic study of 1978 is referred to in literature. A trio of researchers¹² investigated lives of two very disparate groups of people. One group comprised of lottery winners whose lottery prizes ranged between US $ 50,000 to US$ 1 million while the other group was composed of victims of catastrophic accidents who were paraplegic or quadriplegic. The researchers asked the subjects of the two groups to rate the amount of pleasure they derived from their everyday activities, small but enjoyable things, like chatting with a friend, watching TV, laughing at a joke, breakfast, or receiving a compliment. The outcome was surprising and contrary to what we could generally expect. The results suggested that the recent accident victims were gaining more happiness from their everyday pleasures compared to the lottery winners. On average, the winners’ ratings of everyday happiness were 3.33 out of 5 while those of accidents’ victims were 3.38. These findings are quite contrary to the general belief that money brings happiness.

The results are explained by what psychologists call the ‘hedonic treadmill’ or ‘hedonic aspiration’ which postulates that effects of substantial life changes on subjective well-being are temporary. Anything shiny and new in life like a big lottery or acquiring a position of responsibility may be exciting initially but as the individual adjusts and becomes accustomed to the new reality that the person aspired for before acquiring it then the initial jolt of happiness recedes back to its original level. The same principles apply to moments of setback in a person’s life. Setbacks may dampen spirits temporarily, but that state is not constant. Adjustments to new circumstances after some time are due to psychological homeostasis i.e. the tendency among humans to adjust to circumstances. This phenomenon is also explained bit differently by psychologists. Everybody has a ‘ happiness set point’, a baseline level pre-programmed by one’s genetic code and further shaped by early environment. Any change in circumstances, good or bad, thus does not induce permanent change in the level of happiness, the argument goes. This line of thinking is, however, not entirely correct. For example, unemployment brings nothing else but misery. Unemployment is associated with lower levels of well-being. Both cross-sectional and panel data confirm this assertion¹³. The employed are happier than unemployed and when people become unemployed, their happiness level falls and remains at a lower level till they acquire a job. Similarly, such dynamics cannot be applied to people who are clinically depressed.

In addition to genes and circumstances, habits also influence variations in happiness levels. If the ‘genes explanation’ is true and circumstances do not have lasting effects; then this implies that we do not have much flexibility to improve our happiness level based on the said two variables. We, however, have control over habits. We can change and improve this variable by making some conscious efforts. Are we good at human relations? Do we know our flow and enjoy productive work? Do we have some faith system to fall back on during crisis? Do we have friends to share our experiences with? Do we enjoy good relations with our family? Are we in a habit of being thankful for what we have or are we always drawing comparisons with other people? Are we emphatic and kind to fellow beings? Are we altruistic in our nature? Do we believe in taking or giving? These are choices that every human being is free to make. Literature on the science of happiness has found smiling, sociability, health and happiness of dear ones, etc. as important correlates of life satisfaction and happiness.

One cannot change one’s parentage and genetic code. If some misfortune comes, it may take time to get out of it and change the circumstances, but your response depends on your habits and your belief system. An authoritative study on the subject as to what matters the most for happiness is the ‘Harvard Grant Study’ which followed 200 Harvard graduates from 1939-1944 into their 90s, looking at all possible aspects of happiness, including their health and well-being. The study confirmed that recovery from bad childhood experiences is possible and the people who have loving relationships with family and friends thrive in life and are happier. George Valliant, the principal investigator of the Grant study, concluded his findings as follows: “Happiness is love. Full Stop”¹⁴.

Arthur Brooks who teaches a happiness class at Harvard Business School explains happiness in three relationships i.e. Happiness equations¹⁵.

(1) SWB= Genes + Circumstances + Habits
(2) Habits = Faith + Family +Friends+ Work
(3) Satisfaction= What you have/ What you Want

At the individual level, sources of happiness may vary. The level of happiness may also differ with age, income, social class, family ties, value systems, etc. The private mechanism for happiness entails a personal belief system and an attitude to the situation which surrounds a person. Instead of counting the deprivations and wants, one can count the blessings. An undesirable situation does not cause so much unhappiness as our chosen response to it does. We can either fight the situation and change it for the better or give in to the situation and accept the unhappiness it causes. Similarly, our chosen behaviors to deal with people in society may bring us happiness or unhappiness. Diverting the focus from self to others, valuing happiness for self as much as for others does not reduce happiness. Almost every religion in the world has advocated unselfishness and sacrifice. Neuro-physiological research has also affirmed that altruism brings happiness. We need to appreciate that craving to receive more antagonizes happiness, whereas, the yearning to give augments happiness.

We can enjoy higher levels of satisfaction in life if we learn to appreciate the blessings we have and reduce our wants. Happiness is enjoying what you have and not aspiring all the time for more. Giving, not grabbing brings happiness. Feelings of empathy, compassion and kindness at the individual level are the gateway to a happier life. While talking of kindness at Syracuse University in the convocation ceremony for the class of 2013, Professor George Saunders made some pertinent remarks pertaining to kindness and empathy. He said: “What I regret most in my life are failures of kindness. Those moments when another human being was there, in front of me, suffering, and I responded – sensibly. Reservedly. Mildly. Or, to look at it from the other end of the telescope: who, in your life, do you remember most fondly, with the most undeniable feelings of warmth? Those who were kindest to you, I bet.”¹⁶

Going Beyond GDP

Pursuit of happiness has always remained an overarching goal of human beings, at least at the individual level. Since the last decade or so, economists and public policy makers are, however, seriously exploring the idea of subjective well-being for adoption as an ultimate indicator of human progress and prosperity at the collective level. Historically, Gross Domestic Product (GDP) remained at the center- stage of economic literature, perhaps as the only yardstick of human progress, on the premise that it is only material well-being that matters, and GDP captured it correctly. If a country enjoys higher per capita GDP, it simply means that the well-being of its citizenry is also high. But this premise is not an absolute truth and overemphasis of the economists and governments on GDP was misplaced. The World Happiness Report,2012 notes:

“The western economist’s logic of ever higher GNP is built on a vision of humanity completely at variance with the wisdom of the sages, the research of the psychologists, and the practice of the advertisers. The economist assumes that individuals are rational decision-makers who know what they want to and how to get it, or to get as close to it as possible given their budget. Individuals care largely about themselves and derive pleasure mainly through their consumption. Some economists even say that drug addicts have acted rationally, consciously trading off the early benefits of drug use with the later high toll of addiction. These economists say this, but they do not dare examine such foolishness too closely”¹⁷.

GDP as a measure of progress has its own shortcomings. For instance, it does not take into account environmental aspects such as the depletion of natural resources, pollution, destruction of biodiversity, distributional and the inter-generational aspects. Per capita GDP is just the total income of the country divided by the population. The fact that more than 50% of the total income and wealth may be concentrated in the hands of the top 1% of a country is not given much weight in the traditional measures of progress. A country characterized by deep inequalities may be a big reason for low well-being and happiness as relativities and comparisons matter. A country where there is ‘too much luxury and too much inequality’ is hardly a happy society. So, the need was felt to go beyond GDP and explore new measures of human progress and prosperity. Some countries and international organizations are giving serious thought to the idea of happiness as a measurement of well-being. The French government has been publishing its own happiness indicators since 2009. Britain’s Office for National Statistics has a program for measuring national well-being. The Organization for Economic Co- operation and Development (OECD) has prepared guidelines to enable its members to produce “well-being data”.

The problem with the whole idea of happiness is its objective measurement and it is on this point that this idea invites criticism from the economist who are opposed to the idea. They say that, unlike GDP, it cannot be measured objectively and, as such subjective well-being is hard to adopt as a measure of progress at the national level. Happiness economists have, however, found ways to combine subjective surveys with objective data on lifespan, income, and education to produce data with consistent patterns, thus making a ‘national happiness index’ a practical reality. The authors of World Happiness reports argue that: (i) happiness can be measured objectively; (ii) it has predictable causes and is essentially related to some specific variables such as health, income distribution, social capital, governance, etc.; (3) it differs systematically across societies and over time; and (4) it is possible for governments to create the right conditions for happiness to flourish. Governments can, therefore, use happiness as a guide to public policy as they use GDP. Undoubtedly, developing a national happiness index to replace GDP will not be an easy job for researchers. But we should recognize the fact that simplicity is not always an advantage. To make the idea of happiness workable, more efforts will be required at the national as well as international levels. Even if we fail to come up with a satisfactory happiness index in the near future, efforts and time spent on deepening our understanding of factors like collective psychological well-being, quality of governance, and environmental integrity would not go to waste, even if such endeavors are only helpful in increasing the level of public awareness and concern in these areas.

It is high time to re-examine the aims and objectives of our life. Do we want happiness of the people at large or misery for the majority at the expense of the few? Do we want a system of governance based on economic and social justice and free of corruption or a system which crushes the vulnerable and bends for the powerful? Do we want to pursue the material aspect of well-being or desire a living which takes care of our psychological and spiritual aspects? These are a few fundamental questions which need answers to make the idea of subjective well-being workable. We should not add to our delusions and frustrations by merely pursuing material progress and that too of an uneven nature. Even if we have less material resources at our disposal, subjective well-being can be improved through equitable public policies, good governance, and building social capital. But this does not mean that economic growth should not be pursued. Income does matter for happiness. After all, growth brings resources which can be spent on health, education, social schemes, etc. for improving subjective well- being of the people. Scandinavian countries are ranked the happiest. They have more resources as well to devote to medical care, education, sanitation, and nutrition of their citizens. Similarly, they provide more leisure activities, a variety of work, higher education and more funding for culture and arts. The World Happiness Reports find that the world’s happiest countries are in northern Europe: Denmark, Norway, Finland, Netherlands, etc.; and the most miserable are in Africa: Togo, Benin, Central African Republic, and Sierra Leone. This implies that material resources also matter for happiness.

When we say that we need to go beyond GDP, it does not mean downplaying the importance of material goods for happiness. It simply means that money and material wealth are not the only determinants of happiness. A paper¹⁸ written back in 2004 concluded that people with the highest well-being are not those who live in the richest countries but those who live where social and political institutions are effective, where mutual trust is high and corruption is low. The literature on economics of happiness says that well-being and happiness levels will be low in ‘too rich, too unequal’ societies. People in most unequal societies cannot be happier than those living in comparatively egalitarian and less unequal societies. Further, happiness and well-being are positively related to education and health (both physical and mental). High trust leads to happier societies and a happy society is generally a high-trust society where people trust each other, including family members, colleagues, friends, strangers, and institutions.

The policy implications are that both income and non-income factors need to be addressed. Strong affirmative action should be initiated to reduce social and economic inequalities to foster community cohesion. Education and health should become top priority sectors for public spending. Effective steps should be taken to reduce corruption and transaction costs in the society to build trust. This would be possible only through improving governance and making service delivery departments more responsive to the public. Undoubtedly, increasing economic growth and GDP is important. But at the same time it should also be kept in view that GDP is not an end unto itself. The end is well-being and happiness of the people and its attainment is possible only through the right set of priorities and public policy interventions.

Building Blocks of Subjective Well-being

“There is now a rising worldwide demand that policy be more closely aligned with what really matters to people, as they themselves characterize their well-being” said Professor Jeffrey D. Sachs, on the eve of the release of the second World Happiness Report in 2013¹⁹. The idea that happiness should be the overriding goal of public policies has gone global. It is no longer exclusive to Bhutan but several developed countries like France, Germany, South Korea, New Zealand and UK are now seriously working on the idea with a view to gear their public policies towards greater happiness of the people.

The World Happiness Report, 2013 ranked 156 countries of the globe on the happiness index. Pakistanis were the happiest people in the South Asian region, except for the Bhutanese (though the report has not ranked Bhutan). Pakistan stood at 81 against India, Sri Lanka, Bangladesh, and Nepal which respectively stood at 111,137,108 and 135. This pattern has persisted in world happiness reports of subsequent years and there is a lot of year-to- year consistency in the way people rate their lives in different countries, including Pakistan. The World Happiness Report, 2020,²⁰ which is the eighth report, ranks Pakistan at 66 whereas India, Sri Lanka, Bangladesh and Nepal respectively stand at 144, 130,107 and 92. Pakistan fares better than Russia, Malaysia, Indonesia, Vietnam, and Turkey on the happiness index. These rankings make it abundantly clear that happiness ranking of a nation does not necessarily correspond to its per capita GDP (traditional measure of well-being) though most of the happier nations of the world reside in the developed world. The authors of the World Happiness reports, cognizant of the shortcomings of GDP as a measure of progress, rank the nations of the world on the basis of a composite index of six key variables i.e. GDP per capita, healthy life expectancy, social support, freedom of choice, freedom from corruption, and generosity.

Income: Income is the first building block of happiness. Most of the countries scoring higher on the ladder of happiness are in the high- income bracket. Certainly, economic prosperity matters for happiness. The economic aspect is relevant to the concept of happiness from three angles:

1. A nation needs to rise above the basic economic threshold to meet the basic needs of the people. If most of the people are living below the poverty line, it cannot become a happy nation. So economic growth on a sustainable basis, as was the case with the Asian Tigers, is a necessary condition to improve the well- being of a nation.
2. The distribution of material resources in a country is also relevant. Economic performance should be visible in the living standards of the people. “Economic things matter only in so far as they make people happier”²¹. You have to have minimum economic inequities in society. This point is vindicated by the fact that the happiest people of the world reside in societies characterized with low inequality, such as the Scandinavian countries.
3. This angle relates to the economic arrangements in society for low-income people, especially during times of economic distress i.e., a system of economic support in the form of social safety-nets, etc. Though across nations there are diminishing returns to rise in incomes but other variables like health, quality of governance, and respect for human rights which are highly correlated with happiness are also linked to national income.

Health: Healthy lives are the second building block of happiness. Both Physical health and mental health matter. Mental illness is highly ignored in almost all societies, in particular in developing countries. The economic costs of mental illness are high, and it affects approximately 10% of the world population.

Social Support: Everybody needs to fall back on some system in times of economic and mental distress. Social support here does not mean social support programmes only but it emphasizes more than that in the context of happiness. Family, friends and social connections matter. Social connectivity augments happiness. “Man never did live by bread alone, and we have learned—painfully—that too focused a pursuit of bread leads not only to obesity but also to a starvation of other human needs, including social connections, psychological balance and virtue”.²² According to the World Happiness Report 2017, the percentage of the population that reported social suport in times of distress ranged from 29% in Dystopia to 99% in Iceland. The dividends of social support are enormous. Experimental evidence also suggests an interrelation between social support and health.

Freedom form Corruption: Corruption simply implies that you are being cheated. A feeling of cheating and deprivation certainly undermines happiness. A corruption-ridden society mis-allocates resources, distorts incentives and reduces choices. The policy implication is simple: control of corruption should become the top priority with the state to not only improve governance but also establish a happier society.

Freedom of Choice: According to Amartya Sen, development is in fact an expansion of freedoms. “Are you satisfied or dissatisfied with your freedom to choose what you do with your life”, is the question that captures the score on this index. Reports observe a strong correlation between happiness and freedom of choice.

Generosity: Perhaps generosity is the only element that can explain a somewhat of a consistent reasonable score of Pakistan on the happiness index. Traditional economic thought is based on the assumption that human beings are selfish and that their every action is guided by personal motives. Altruism was considered an aberration according to this line of thinking. Such assumptions which dominated traditional economic thought are now seriously under attack in the light of research in the fields of experimental economics, psychology and neuroscience. For example, Elizabeth Svoboda, in the article ‘Hard-wired for giving’,²³ while quoting various research studies about the human brain concluded that giving is a rewarding experience per se. Experiments on human brain show that giving and generosity are great sources of happiness and the human brain is wired for giving, implying that human beings may not be selfish by nature, rather their self-interested behaviour may be an outcome of environmental factors.

Broadly speaking, the six areas which constitute building blocks of subjective well-being as per insights from the World Reports are the areas where public interventions can be made by the government to improve subjective well-being at the collective level. The questions that need answers are: How can economic growth be enhanced; and how should income be distributed in society? How much public spending should be allocated for health? What support systems should be put in place, especially for the vulnerable sections of society, to help them in times of distress? How can corruption be dealt with to improve governance? What public policy interventions are needed to ensure freedom of choices? And, how can generosity and pro-sociality be embedded in public policies to improve subjective well-being of the stakeholders?

Public Policy Prescriptions

Public policies are needed to ensure that people’s basic needs are met. People must have access to health care, clean water, a clean environment and education. Unemployment is one of the primary economic sources of unhappiness. Employment provides not only income but it also helps people realize their social needs through networking. A bad job is better than no job. Public policies should be geared towards employment generation. In this regard, interventions are needed to make entry of entrepreneurs into business easy and promote as well as incentivize private sector for creation of jobs.

In addition, a paradigm shift is needed in the way public services pertaining to healthcare and education are currently being delivered. Primary care hospitals and basic rural units in rural areas should survey the population that falls under their jurisdiction to collect their medical history. Preventive healthcare should be accorded equal importance as cure. Once surveys of the population are completed and data banks prepared, these hospitals and centres should maintain an active liaison with patients. Presently, patients are required to visit the hospitals or Basic Health Units (BHUs), however, if a data bank is in place, patients can be taken care of remotely, even online. Medical camps can be established by hospitals after a specific time interval, say three months, for routine checkups and to update the history of patients in the area. The hospitals and BHUs should be divided into two parts: the mobile part should be used for preventive healthcare, routine checkups, and updating patients’ history; and the other immobile part for serving serious patients who are admitted in hospitals or BHUs.

As far as education is concerned, schools should ensure a high number of enrollments in their respective areas. Public-private partnerships should be forged to achieve this objective. Multiple shifts should be initiated in both private and public schools to educate all the children of an area. If health and education improve, subjective well- being of the population will improve.

Furthermore, socio-economic inequities need to be minimized in society. The creation of a happy society requires the bridging of the gap between the rich and the poor. “Happiness is equality”²⁴, says Professor Robert Skidelsky of Warwick University. Happiness calls for a judicious environment which provides level playing field and equality of opportunity. Ostentatious living, display of wealth (often gotten through rent-seeking and corruption) and the perverted values which employ such behaviors as a measure of status and prestige further deteriorate happiness in society. Extravagant spending on weddings, building palatial houses, luxury cars, and protocol systems are some of the ostentatious displays of wealth within our society. In this context, two things need to be done. One, ostentatious display of wealth should be discouraged as a public policy measure. Palatial and big farm houses, luxury cars, etc. should be highly taxed. There is also a need to revive wealth tax and inheritance tax. Second, the media and opinion makers should build public opinion that values austerity and castigates display and wastefulness.

In his paper ‘The economics of happiness’²⁵, Professor Easterlin wrote: “evidence indicates that over the life cycle, family and health circumstances typically have lasting effects on happiness, but that more money does not. Each of us has only a fixed amount of time available for family life, health activities, and work. Do we distribute our time that maximizes our happiness? The answer, I believe, is no. We decide how to use our time based on the false belief that more money will make us happier. Because of this money illusion, we allocate an excessive amount of time to monetary goals, and shortchange non-pecuniary ends such as family life and health”. So the way we allocate our time has implications for happiness. Social scientists have come up with techniques like evaluated time use and day reconstruction method (DRM) to evaluate people’s highs and lows during the day. These techniques may be used for evidence-based public policy decisions regarding working hours in offices and work-life balance.

Rule of law and control over corruption are also deeply connected to the overall happiness of a society. Impact of corruption is differential and discriminatory. It falls heavily on small businesses and the disadvantaged sections of society. Corruption deepens the chasm between the poor and the rich, big businesses and small enterprises, the powerful and the powerless, etc. It is a well-known fact that strict enforcement of the canons of rule of law is lacking in developing countries. The elite are socially and politically well-connected. They can buy public services like utility connections, access to law enforcement agencies for redressal of their grievances and dispensation of justice, whereas the cost borne by the less powerful and poor for such public goods in a corrupt institutional set-up is very high. Corruption is regressive for small businesses as well. One of the reasons behind the inadequate rate of development of the small and medium enterprises (SME) sector in Pakistan remains corruption. Corruption creates, sustains and perpetuates poverty and inequality traps in society. Transparency and access to information are great tools for combating corruption. Rules, regulations, and enactments of the government should be publicly available. Administrative and legal decisions should be in reach of the citizenry to decrease the potential of prismatic decisions by public functionaries. Corruption prospers in darkness. Transparency and corruption are opposites. Publicizing information, rules, regulations and procedures promote transparency and reduce the potential for corruption.

Investing in social capital also enhances happiness. Educational programs that highlight social dilemmas and the potential gains of cooperation can create an improved environment. Implementation of a ‘life-skills curriculum’ in schools can be a right step in this regard. Further, universal access to education is more likely to promote social capital through several channels such as raising awareness of social dilemmas, reducing social and economic inequalities, fostering a better understanding of public policy debates, raising individual skill levels and creating an educated citizenry that can keep government in check. Education and the quality of governance are two important channels through which social capital can be built. Public policies for improving subjective well-being, therefore, essentially require more focus on improving schooling and governance. Moreover, public policies that narrow income and wealth inequalities can raise social capital. Adoption of universal social benefits and strong safety nets, as is the case in Scandinavian countries, can also foster social trust in society. A focused effort to reduce public corruption is also needed to build social capital. Strengthening of deliberative democracy in which individuals meet face to face or virtual online groups to discuss and debate public policy issues can also produce the same affect. Consistent evidence that effective democracy fosters generalized trust is a powerful indication that good governance not only reduces transaction costs in the economic sphere but also produces social capital (WHR,2015).

Sustained positive emotion, empathy, altruism, and pro-social behaviour are considered some important constituents of well-being and happiness. “Well-being is found to be elevated when individuals are better able to sustain position emotion; recover more quickly from negative experiences; engage in empathic and altruistic acts; and express high levels of mindfulness. In each case, a growing body of evidence is pointing towards these four constituents to well-being. In some cases, effects are stronger for certain components of well-being, such as purpose in life, or positive relations with others”²⁶ In the context of these four constituents of happiness, training programs can be developed in schools and colleges to cultivate mindfulness, kindness, empathy, generosity, etc.

There is a strong correlation between mental health and happiness. Mental health is the single most important determinant of individual happiness. On average, 10% of the world population suffers from clinical depression or anxiety disorders. “Those who suffer from mental illness are doubly unfortunate. They have the condition in the first place, but in addition they are discriminated against and written off as hopeless cases. It is time for every society to become much more open about mental illness just as with other illnesses. If we want a happier world, we need a completely new deal on mental health.” (WHR, 2013). A happier nation is certainly composed of mentally and physically healthy individuals. In case of Pakistan, mental health has remained an ignored area. Few hospitals and centres exist in the country for the treatment of mental diseases. Common mental diseases hardly ever enter our planning and budget allocations. Depression, anxiety, severe anger, domestic violence, torture, etc. are all manifestations of mental disorders. At least two policy steps should be taken without further delay. First, separate budget allocations should be made for the establishment of mental hospitals and treatment of mental ailments. Second, individuals tasked with responsibilities of public service delivery should be identified and, if required, treated for mental disorders. It would be beneficial for them on an individual level and its impact would be manifold on the quality of public service delivery. Mental health should be an important criterion for the placement and promotion of public sector employees.

Policy makers need to know the causes of happiness and misery. Some of these are factors that affect everyone in a society, while other vital factors differ across individuals. Key factors include economic factors such as income and employment, social factors such as education and family life and health mental as well as physical.²⁷ Public policies for subjective well-being thus should necessarily aim at better health and education facilities, speedy justice, reducing corruption and narrowing the gap between the rich and the poor, and building social capital. Such public policies will bring happiness in the society through minimizing inequality and unfairness, the two major causes of unhappiness.

References

1. Graham, Carol, and Stefano, Pettinato (2001). “Happiness, Markets, and Democracy: Latin America in comparative perspective.” Journal of Happiness Studies 2(3):237-68.
2. Easterlin, Richard A. & Angelescue, Laura (2009). “ Happiness and Growth the world over: Time series Evidence on the Happiness-Income Paradox.” IZA Discussion Paper No. 4060, March 2009.
3. Balasubramanian, Sriram & Cashin, Paul (2019). “ Gross National Happiness and Macroeconomic Indicators in the Kingdom of Bhutan.” IMF Working paper WP/19/15. This working paper contains detailed discussion on GNH and says that the concept involves lot of subjectivity but has played an important role in enabling Bhutan to improve its macroeconomic indicators on sustained basis.
4. Stiglitz, Joseph E.; Sen, Amartya Kumar; & Fitoussi, Jean-Paul. (2009). “Report by the Commission on the Measurement of economic performance and social progress”. Commission on the Measurement of Economic Performance and Social Progress, Paris.
5. Easterlin, Richard A. (1994). “ Does Economic Growth Improve the Human Lot? Some Empirical Evidence.” in Paul A. David and Melvin W. Reder, eds., Nations and Households in Economic Growth, New York: Academic Press.
6. Pigou, A.C. 1920. The Economics of Welfare. Macmillan, London.
7. Okinawa, Simon Elegant. (2003). “ Long Lives well lived”. Time Magazine, July 21,2003. This report is on longevity in Asia and includes detailed reporting on Hunza Valley. The reporter has discussed various factors responsible for longevity of residents of Hunza valley and discusses various factors like water, genetic makeup, and dietary habits etc. Several other articles like one by Vlahchev and Zhivkov in Bulgarian with the title ‘ Hunza- a healthy and long living people’ says that as the people of Hunza live in peace and not emotionally stressed, so they are happy and enjoy long life.
8. SATO, Hiroshi. (2004). “ Social Security and Well-Being in a Low-Income Economy: An Appraisal of the Kerala Experience”. The Developing Economies, XLII-2 (June,2004), pp 288-304
9. Sen, Amartya. (2012). “ Human Development in the Post-2015 Era”. Lectured delivered at the launch of the International centre for Human Development on 4th January, 2012 at the Stein Auditorium, India Habitat Centre, New Delhi. In this lecture, Amartya Sen talks of importance of human development and compares Indian states of Gujarat, Tamil Nadu, Himachal Pradesh, and Kerala on per capita median income and human development indicators and makes out a case that Kerala states fares well among them.
10. Rojas, Mariano. (2018). “Happiness in Latin America has Social Foundations”, included as Chapter 6 of the World Happiness Report,2018. Centre for Sustainable Development, Earth Institute, Columbia University, New York (USA).
11. Lykken, D., & Telligen, A. (1996). “ Happiness is a stochastic phenomenon”. Psychological Science, 7(3), 186-189
12. Brickman, P., Coates., & Janoff -Bulman, R. (1978). “ Lottery Winners and Accident victims: Is happiness Relative?”, Journal of Personality and Social Psychology, 36 (8),917-927
13. Clark, Andrew E. (2006). “ A Note on Unhappiness and Unemployment Duration”. IZA DP No.2406
14. Valliant, G.E. (2012). “ Triumphs of experience: The Men of the Harvard Grant study”. Belknap Press of Harvard University Press.
15. Brooks, Arthur.C. (2020). “ The Three Equations for a Happy Life, Even during a Pandemic”, The Atlantic, April 9,2020
16. Refer to address to 2013 graduating class of Syracuse University.
17. Sachs, Jeffrey D. (2012). “ Introduction to World Happiness Report”, included as Chapter 1 of World Happiness Report, 2012, Earth Institute, Columbia University, New York (USA).
18. Helliwell, John. F. (2004). “ Well-being and Social Capital: Does Society pose a puzzle?”, NBER Working Paper 10896.
19. Helliwell, J., Layard, R., & Sachs, J. (2013). World Happiness Report 2013, Earth Institute, Columbia University, New York.
20. Helliwell., J., Layard, R, & Sachs, J. (2020). World Happiness Report 2020, Earth Institute, Columbia University, New York.
21. Ostwald, Andrew J. (1997). “ Happiness and Economic Performance “. The Economic Journal, Vol. 107, No.445, 1815-1831
22. Layard, R, Chisholm, Dan, Patel, Vikram & Sakena, Shekhar. (2013). “ Mental Illness and Unhappiness”, Chapter 3, included in World Happiness Report, 2013.
23. Svoboda, Elizabeth. (2013). “Hard wired for giving”, Wall Street Journal, August 31,2013.
24. Skidelsky, Robert. (2012). “ Happiness is Equality”. Project Syndicate, October 19,2012.
25. Easterlin, Richard A. (2004). “ The Economics of Happiness”. Daedalus, Vol. 133, No.2, On Happiness (Spring ,2004),26-33
26. Helliwell., J., Layard, R, & Sachs, J. (2015). World Happiness Report 2015, Earth Institute, Columbia University, New York
27. Helliwell., J., Layard, R, & Sachs, J. (2017). World Happiness Report 2017, Earth Institute, Columbia University, New York