“Every day, in every industrialized country of the world, journalists and politicians give
out a conscious and unconscious message. It is that better economic performance means
more happiness for a nation. This idea is rarely questioned. We feel we would be more
cheery if our boss raised our pay, and assume that countries must be roughly the same.
The results in this paper suggest that, in a developed nation, economic progress buys
only a small amount of extra happiness.“ (Oswald 1997, p. 1827)
Based on Oswald’s introductory statement, this paper is going further than refuting the assumption that a
certain kind of utility is solely contingent on absolute earnings. With the interpretation
of utility as happiness, it would mean for the aggregate economy as well as for the
individual that income secures happiness with a rising tendency. Having started with
Oswald, another economist with well-known findings has to be made mention of:
Richard Easterlin, who constructed the hypothesis that from a certain threshold of
developmental achievements on, economic growth is of minor significance to the overall
life satisfaction of a nation. The so-called Easterlin paradox originally arose as data on
richer citizens within a country displayed a higher level of subjective well-being and led
to the assumption that “economic growth improve[s] the human lot” (Easterlin 1974).
Nevertheless, a comparison amongst well-developed states and over time revealed that
there’s little difference of each population with regard to happiness. Thus, it appears
that not the absolute but relative wealth is of import to life satisfaction in crossindividual
and cross-stratum comparisons. Even though it never gained as much
attention as its foreshadowing counterpart by Easterlin, the phenomenon is also
denoted as the “relative deprivation theory” (Oswald 1999, p. 360), pointing out the
state of deprived happiness poorer individuals in a society suffer.
Inhaltsverzeichnis (Table of Contents)
- Introduction
- Economic growth and happiness
- Happiness
- The Easterlin paradox
- Within-country comparisons
- Cross-country comparisons
- Time-series data
- Conclusion
- Social comparison and relative income hypothesis
- Adaptation effect and hedonic treadmill
- Jevon's paradox and uneconomic growth
- Conclusion
- Alternatives to the neoclassical growth paradigm
- Neoclassical economics and the growth model
- Dematerialization and decoupling
- Economic degrowth, developed nations and policy implications
- Degrowth policy and prosperity
- Government and policy
- Feasibility of degrowth and social change
- Normativity, sustainability accounts and institutions
- Conclusion
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This paper examines the Easterlin paradox, which states that economic growth beyond a certain point does not lead to increased happiness in developed nations. The paper investigates the implications of this paradox for degrowth policies, exploring whether these policies could be a viable alternative to the traditional growth paradigm. Key themes covered in the paper include:- The relationship between economic growth and happiness
- The Easterlin paradox and its implications for societal well-being
- The feasibility and potential benefits of degrowth policies for developed nations
- The role of government and policy in promoting degrowth and national prosperity
- The importance of considering philosophical perspectives on degrowth and its implications for societal progress
Zusammenfassung der Kapitel (Chapter Summaries)
The paper begins with an introduction outlining the central question of whether the Easterlin paradox justifies the implementation of degrowth policies in developed nations. It highlights the concept of utility as happiness and explores the idea that income beyond a certain threshold fails to significantly increase well-being.
Chapter 2 delves into the relationship between economic growth and happiness, defining the concept of happiness and its measurement. It examines the Easterlin paradox in detail, analyzing within-country, cross-country, and time-series data to demonstrate that while income disparities within a country correlate with happiness levels, economic growth across nations and over time does not necessarily lead to increased happiness. This chapter also explores theories such as the social comparison and relative income hypothesis, and the adaptation effect and hedonic treadmill, which contribute to understanding the complexities of happiness and its relationship to economic factors.
Chapter 3 presents alternative perspectives to the neoclassical growth paradigm, arguing that continuous economic growth might not be the optimal path for achieving societal well-being. It discusses concepts like dematerialization and decoupling, where economic growth is separated from environmental impact, and proposes economic degrowth as a possible solution to address environmental and social concerns.
Chapter 4 focuses on degrowth policy and its implications for achieving prosperity. It examines the role of government and policy in promoting degrowth, analyzes the feasibility of degrowth measures, and explores the importance of normative frameworks and sustainability accounts for implementing effective degrowth policies.
Schlüsselwörter (Keywords)
The paper focuses on key terms and concepts related to economic growth, happiness, and degrowth. These include: Easterlin paradox, subjective well-being, relative deprivation theory, degrowth economics, green economics, steady state economics, dematerialization, decoupling, sustainability accounts, and normative frameworks. The work also explores the intersection of economics and social science, particularly in relation to policy implications for developed nations.- Quote paper
- Annette Becker (Author), 2014, Does the Easterlin paradox legitimize the implementation of degrowth policies in developed nations?, Munich, GRIN Verlag, https://www.grin.com/document/288346
