Subjective Well-Being and Policy

This paper analyses whether the aggregation of individual happiness scores to a National Happiness Index can still be trusted once governments have proclaimed their main objective to be the pursuit—or even maximization—of this National Happiness Index. The answer to this investigation is clear-cut: as soon as the National Happiness Index has become a policy goal, it can no longer be trusted to reflect people’s true happiness. Rather, the Index will be systematically distorted due to the incentive for citizens to answer strategically and the incentive for government to manipulate the Index in its favour. Such a distortion would arise even if the measurement of subjective well-being correctly reflected actual happiness before the intervention of government. Governments in a democracy should establish the conditions enabling individuals to become happy. The valuable and important results of happiness research should be introduced into the political process. Each person should be free to pursue happiness according to his or her preferences. This process is supported by obedience to the rule of law, human rights and free media, as well as by extended political participation rights, decentralized public decision-making, an open and effective education system fostering upward mobility and the possibility to find suitable employment.