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Relationships and good health the key to happiness, not income

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Most human misery is due not to economic factors but to failed relationships and physical and mental illness. Eliminating depression and anxiety would reduce misery by 20% while eliminating poverty would reduce it by 5%. And on top of that, reducing mental illness would involve no net cost to the public purse.

These are among the findings presented at a landmark conference on wellbeing this week at the London School of Economics (LSE), co-organised with the Organisation for Economic Co-operation and Development (OECD) and other leading institutions.

Experts from around the world will assess the research evidence on wellbeing over the life course – and the policy implications for how best to reduce misery and promote wellbeing. Lord Richard Layard and his LSE team at the Centre for Economic Performance (CEP) presented for the first time the results of their monumental study of the Origins of Happiness, analysing survey data from four countries.

Among the findings on the key determinants of people’s life satisfaction:

  • Income inequality explains only 1% of the variation in happiness in the community, while mental health differences explain over 4%. Education has a very small effect on life satisfaction, compared with, for example, having a partner.
  • When people evaluate their income or education, they generally measure it against the locally prevailing norm. As a result, overall increases in income or education have little effect on the overall happiness of the population: if my relative income rises, someone else’s must fall, and the average is unchanged. This helps to explain why in Australia, Britain, Germany and the United States, average happiness has failed to rise since records began, despite massive increases in living standards.
  • The strongest factor predicting a happy adult life is not children’s qualifications but their emotional health. There is also powerful evidence that schools have a big impact on children’s emotional health, and which school a child goes to will affect their emotional wellbeing as much as it affects their exam performance.

Lord Layard said:

“The evidence shows that the things that matter most for our happiness and for our misery are our social relationships and our mental and physical health. This demands a new role for the state – not ‘wealth creation’ but ‘wellbeing creation’.’

“In the past, the state has successively taken on poverty, unemployment, education and physical health. But equally important now are domestic violence, alcoholism, depression and anxiety conditions, alienated youth, exam-mania and much else. These should become centre stage.’

This week’s conference featured presentations by Mari Kiviniemi, Deputy Secretary General of the OECD; Professor Jeffrey Sachs, co-editor of the World Happiness Report; and Professor Alan Krueger, former Chairman of the US Council of Economic Advisers and a wellbeing expert. Separate papers were presented on wellbeing in Australia, Denmark, France, Germany, Norway, Sweden and United States.

In addition Professor Paul Frijters, now of LSE, launched a World Wellbeing Panel providing monthly comments on world events from a wellbeing perspective.

Nancy Hey, director of What Works Centre for Wellbeing, says:

‘Most people are convinced that improving wellbeing is important and that there is a need to act. What is trickier is understanding what organisations – government, business, communities – can do.

“This world-leading research helps us understand what really supports people to live better lives. These findings can be used to inform policy and spending decisions, and I hope will lead to trials that continue to build the global evidence base of what works to improve wellbeing”

Notes for editors

For more information contact: Romesh Vaitilingam 07768 661095 (romesh@vaitilingam.com) or Richard Layard 07790 906206.

For a pdf of Origins of Happiness please contact Harriet Ogborn, email H.Ogborn@lse.ac.uk, Tel: 020 7955 7048.

Notes for editors:

The conference on 12-13 December 2016 was jointly organised by the OECD, the Centre for Economic Performance of the London School of Economics, and the CEPREMAP Wellbeing Observatory of the Paris School of Economics, in conjunction with the What Works Centre for Wellbeing.

13 December 2016

 

 

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