Robert A. CumminsAustralian Centre on Quality of Life

Deakin University

Happiness and Public Policy

http://www.deakin.edu.au/research/acqol

The traditional route to happiness is money

So the best public policy for increasing happiness,

according to Economists

is to make populations richer

So, around the world, prior to 1970’s

Quality of Life = GDP.

Economic growth and

Subjective Wellbeing in Japan

Deflated GDP/capita

(Diener & Biswas-Diener, 2002)

0

50

100

150

200

250

300

350

400

450

500

550

1958 1960 1962 1964 1966 1970 1974 1976 1978 1980 1982 1987

Year

GDP is held as a percent

of its 1958 value

Increasing GDP does NOT = increasing happiness!

Deflated GDP/capita

Life Satisfaction

(Diener & Biswas-Diener, 2002)

0

50

100

150

200

250

300

350

400

450

500

550

1958 1960 1962 1964 1966 1970 1974 1976 1978 1980 1982 1987

Year

GDP is held as a percent

of its 1958 value

Life satisfactionis the actual

value foreach year

Quality of Life

Objective QOL Subjective Wellbeing[happiness]

Objective Conditionse.g. Physical health

Subjective Perceptionse.g. Satisfaction with health

?

Subjective Wellbeing

A positive state of mind that involves the whole life experience

How do we measure it?

How satisfied are you with your-----[life domain]?

“How satisfied are you with your life as a whole”?

This can be broken down in a number ofLife Domains

How can we recognize the MINIMUM number of life domains?

“How satisfied are you with your life as a whole?”

Standard of living

Health

Achieving in life

Relationships

Safety

Community connectedness

Future security

Spirituality/Religion

Domains: all must contribute unique variance

β

ββ

β

β

ββ

β

Personal Wellbeing Index

• Standard of living• Health• Achieving in life• Relationships• Safety• Community connectedness• Future security• Spirituality/Religion

How satisfied are you with your-----?

How satisfied are you with your ----?

0 1 2 3 4 5 6 8 8 9 10

CompletelyDissatisfied

CompletelySatisfiedMixed

[Jones and Thurstone ,1955]

11-point, end-defined scale

We code all data to lie on a range from

0 100

Completedissatisfaction

Completesatisfaction

Why is subjective wellbeing important?

Positive emotions build a range of personal resources as:

Physical resources (health, longevity)

Social resources (friendliness, social capital)

Intellectual resources (intellectual curiosity, expert knowledge,)

Psychological resources (resilience, optimism, creativity)

In 2000 we linked with our industry partner, Australian Unity

Purpose: to create a quarterly index of subjective wellbeing for the Australian

population.

As an alternative to the traditional economic indicators such as GDP

This is a world first

No other country has a quarterly wellbeing index

(but others are going to follow)

The International Wellbeing Group 48 Countries and Provinces

AlgeriaArgentinaAustraliaAustriaBelgiumBrazilCanadaChina (Hong Kong ) (Macau) [from 2007-2/yr] (Qinghai province, Yushu

prefecture) (Shandong Province)CroatiaEnglandFinlandFrance

GermanyGreenlandHungaryIranIrelandIsraelItalyJapanLaosLatin AmericaLebanonMalaysiaMexicoNetherlandsNew ZealandNorway

PakistanPhilippinesPolandPortugalRomaniaRussiaRwandaSingaporeSlovakiaSouth AfricaSpainSwitzerlandTaiwan[Thailand]USAWest Indies

The Australian Unity Wellbeing Index Surveys

Geographically representative sample

N = 2,000

Telephone interview

#1: April 2001

------------

#17: April 2007

PWI 2001 - 2007

87654321

SurveyDate

Major eventspreceding survey

>S11

>S2, S4, S5

Scores above this line aresignificantly higher than S1

72

73

74

75

76

77

S1

Apr 2

001

S2 Sep

t 200

1

S3 M

ar 2

002

S4 Aug

200

2

S5 Nov

200

2

S6 M

ar 2

003

S7 Ju

n 20

03

S8 Aug

200

3

S9 Nov

200

3

S10 F

eb 2

004

S11 M

ay 2

004

S12 A

ug 2

004

S13 M

ay 2

005

S14 O

ct 2

005

S15 M

ay 2

006

S16 O

ct 2

006

S17 A

pr 2

007

Strengthof

satisfaction

Key: 1 = September 11 2 = Bali Bombing 3 = Pre-Iraq War 4 = Hussein Deposed 5 = Athens Olympic 6 = Asian Tsunami 7 = Second Bali Bombing 8 = New Industrial Relations Laws

Normative range using survey mean scores as data (N=17)

0

10

20

30

40

50

60

70

80

90

100

SD = 0.8

Mean = 74.9

76.4

73.4

SubjectiveWellbeing

Very satisfied

Very dissatisfied

Why is subjective wellbeing held so steady?

Homeostasis

Just like we hold body temperature steady

Subjective wellbeing homeostasis

Each person has a set-point for their subjective wellbeing.

60

90

Range forindividualset-points

These set-points lie between

60 and 90

Set-points are always POSITIVEie above 50

The average set-point is 75.

75

60

90

Range For

individualset-points

[The set-point for the average person ]

Each person has a set-point for their subjective wellbeing.

75

Time

60

90

When nothing much is happening to them, people rate how they feel about their life in terms of their set-point for SWB

The average set-point

Homeostasis can fail

OverwhelmingNegative

Challenges

Subjective wellbeing

The result of subjective wellbeing loss is depression

Homeostasis can be defeated by:

Poverty

Chronic pain (arthritis)

Chronic stress (carers)

Lack of intimacy

Living conditions (street-kids)

Incarceration (prisoners)

But people are RESILIENT !

Challengingsituations

Subjective wellbeingX

External resources(eg. relationships,

money)

Internal resources(eg. Finding meaning

for the bad event)

This is why there is normally such a poor relationship betweensubjective Wellbeing and the objective QOL indicators

Persistent homeostatic failure[demands chronically exceed resources]

40

Time

Subjective wellbeing

Depression

60

90

How can these subjective social indicators be used to enhance

population happiness?

A. They can tell us about when additional resources are, and are not, likely to benefit SWB

The effect of both on SWB is not linear (ie more is not necessarily better)

BUT

The relationship of both with SWB can be understood via homeostasis

Does greater wealth always benefit SWB?

NO

Income and subjective wellbeing

Median

Total N ≈ 30,000

76.3

Normal Range

73.0

*78.0

*76.5

*73.9

71.7

74.9

78.3

79.2

71

72

73

74

75

76

77

78

79

80

81

<$15 $15-30 $31-60 $61-90 $91-120 $121-150 $150+

Household Income ($'000)

Subjectivewellbeing *

Beyond a certain income there is no further benefit to subjective wellbeing

B.Subjective Social Indicators be used---

to identify geographic areas that require additional resources

Parliament House in Canberra

In 2005 we compared theSubjective Wellbeing of

the 150 Federal electorates

New South Wales

Above average Below averageAverage

Summary Both objective and subjective social

indicators provide important and different information

Both sources of information used to make policy decisions

Optimization of Social Development according tothe availability and distribution of resources

Objective Social Indicators

e.g. National wealth

Subjective Social Indicators

e.g. Subjective Wellbeing