The pursuit of happiness

Hard on the heels of a University of Cambridge report showing that Britain is only the ninth happiest nation in Europe*, comes a paper from across the pond - Chicago Graduate School of Business to be exact - suggesting that, regardless of geography, we humans all have a hard time making the right choices when it come to getting happier.

by Andrew Saunders
Last Updated: 06 Nov 2012

There are two fundamental problems when it comes to taking decisions that will make us happy, say authors Christopher Hsee and Reid Hastie. One is that we often fail to predict accurately what our future experience of a choice made today will be - so when food shopping on an empty stomach, our hunger makes us buy much more than we actually need, for example. The other is that even on those few occasions when we do make good predictions we then fail to act on them. So the researchers found that, due to a desire to make apparently rational choices, people often choose something that they know is not going to make them happier. For instance, most people will choose a large chocolate shaped like a cockroach rather than a small one shaped like a heart, despite having predicted earlier that they would enjoy the hearty shaped one more.

There are some interesting and contradictory conclusions to be drawn from this. First off, where would our modern consumer society be without our willingness to be lured off the righteous path by our own impulsive desires? It's why marketing works. Secondly, it's a fundamental assumption of classical economics that well-informed individuals take decisions that are in their own best interests. Choices about healthcare provision, pensions, investments and so forth. If - as this work suggests - this isn't entirely the case, the implications for policy makers are considerable. Are you listening, Gordon?

*But at least we are happier than the French, Germans and Italians.

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