Adaptive Preferences and Capabilities: Some Preliminary Conceptual Explorations

The Capability Approach (CA) as developed by Amartya Sen and Martha Nussbaum, has in part been a response to the problem of adaptive preferences. Their argument says that people might adapt to certain unfavorable circumstances and any self-evaluation in terms of satisfaction or happiness will in this case necessarily be distorted. To evaluate people's well-being in terms of functionings and capabilities guarantees a more objective picture of people's life. Next to this strong criticism on subjective measurements of well-being, we observe an increasing interest in Subjective Well-Being (SWB) or Happiness studies that are included in the broader field of Hedonic Psychology. In this paper, we thus revise the original critique of adaptive preferences and compare it with a more detailed analysis of adaptation as it is presented in hedonic psychology. It becomes clear that adaptation can be a positive as well as a negative phenomenon and that the adaptive preference critique had a particular narrow view on adaptation. However, this does not mean SWB-research is not any longer susceptible to this critique. An alternative way to assess people's subjective well-being, but which could be considered to be more in line with the CA, is proposed by Daniel Kahneman's Objective Happiness. These are all relatively new considerations, especially in economics. Therefore much more research needs to be done on the positive and negative aspects of adaptation to understand its consequences on well-being – especially when evaluated within the capability-space.     

Happiness and consumption: evidence from China

Using the 2012 China Household Finance Survey, this study finds that happiness in China is positively associated with expenditures on status-related and socially motivated goods, not with spending on improving material well-being or primarily intended for procuring material goods. It also reveals that socially motivated consumption has a status element and the effects of different types of consumption on happiness vary with people’s educational background.     

On the many accounts of public happiness

Economists of the HEIRS association for Happiness Economics and Interpersonal Relations promote a better understanding of the fundamental importance of sociality for people’s happiness. The 2013 conference on “Public Happiness” did justice to this goal and provided an overview of stimulating new developments in the study of people’s well-being. The special issue focuses on the one hand on social comparison processes that most naturally emerge if people form interpersonal connections. On the other hand, it contributes to the conceptualization of the many different accounts of public happiness.     

The price of the market: pursuit of self-interest as annihilation of self

The paper criticizes the view that the market provides for the well-being of individuals by offering the widest field for the pursuit of self-interest. It argues, first, that this view is disastrously mistaken because it misunderstands what individuals are, but, second, that proponents of this view??notably Adam Smith in The Wealth of Nations and the neoclassical economists??actually show the opposite of what they claim: that is, they show that pursuit of self-interest in the market is the annihilation of self. Thus, the proponents of the view show that it is untenable and at least point toward the terms necessary for a more adequate alternative. The paper then asks whether the market must be like this, first, through considering a line of thought on the possibility of a non-predatory market that runs from Aristotle, through the Italian Civil Happiness school, to modern socialist writers. Second, it offers an alternative view of the individual, according to which individuality is in part constituted through substantial relations with other individuals, a version of which can be found in Smith??s Theory of Moral Sentiments and Lectures on Jurisprudence. On the basis of these two discussions, a market order that sustains rather than destroys individuals can be imagined. However, this order would have lost many central characteristics of the capitalist market order.     

Inequality of Happiness in the U.S.: 1972–2010

It is well accepted that a country's GDP may not fully reflect its level of well‐being. In recent years, happiness has emerged as an alternative indicator of well‐being, and research has mainly focused on determining the level of happiness. While it is important to look at the level, the distribution of happiness is also a salient aspect in any evaluation of inequality. There has been a growing interest in the distribution of happiness, although the ordinal nature of the data makes the use of standard inequality measures problematic. Our paper contributes to the literature by exploring the distributions for the U.S. from 1972 to 2010. Based on new methods developed for ordinal data, we are able to overcome the problems associated with ordinality and obtain unambiguous rankings of happiness distributions. We also compute the level of happiness inequality using existing measures based on median centred approaches. Further, we decompose the median based inequality measures of happiness by gender, race, and region.     

Comparing Interpersonal Comparisons in Utility Theory and Happiness Research

Social scientists are reluctant to make explicit interpersonal comparisons of well-being. However, implicit comparisons are made on a surprisingly regular basis. These comparisons are based on the wealth and the Kaldor–Hicks concept in utility theory and on self-reported well-being in happiness research. Taking a utilitarian stance, this paper tests the ethical foundations of both principles. While self-reported well-being serves as an acceptable proxy for utilitarian decision-making, the Kaldor–Hicks concept does not appear so. Implications for evaluating policies are outlined.

Entrepreneurial strategy v. accounting accuracy in ‘calculating’ capital and income

Both entrepreneurs and accountants ??calculate?? capital and income but their procedures diverge. The paper examines this divergence and the respective calculational objectives of entrepreneurs and accountants in the business enterprise. For the entrepreneur, capital and income are ex ante calculational judgments of prospective income gain from strategic use of the enterprise??s capital goods. But the accountant must shun entrepreneurial judgments to ??calculate?? the contemporary net market value of enterprise??s capital goods at a specified date. Hence, the accountant??s calculation of income is the net contemporary increase in the market value of the enterprise??s capital goods. These accounting calculations facilitate assessment of the success of an enterprise strategy. But critics assert that accounting practice ignores the need of external investor??s for accurate information on enterprise prospects. The paper concludes with a critique of accounting regulation and explores the feasibility and means of privatizing the entrepreneurial choice of accounting techniques.     

Mirror neuron research and Adam Smith’s concept of sympathy: Three points of correspondence

In The Theory of Moral Sentiments, Adam Smith asserts that humans have an innate interest in the fortunes of other people and desire for sympathy with others. In Smith??s theory, sympathy is an imperfectly reflected combination of emotion and judgment when one observes someone (the agent) in a particular situation, and imagines being that person in that situation. That imagination produces a degree of interconnectedness among individuals. Recent neuroscience research on mirror neurons provides evidence consistent with Smith??s assertion, suggesting that humans have an innate capability to understand the mental states of others at a neural level. A mirror neuron fires both when an agent acts and when an agent observes that action being performed by another; the name derives from the ??mirroring?? of the action in the brain of the observer. This neural network and the capabilities arising from it have three points of correspondence with important aspects of the Smithian sympathetic process: an agent??s situation as a stimulus or connection between two similar but separate agents, an external perspective on the actions of others, and an innate imaginative capacity that enables an observer to imagine herself as the agent, in the agent??s situation. Both this sympathetic process and the mirror neuron system predispose individuals toward coordination of the expression of their emotions and of their actions. In Smith??s model this decentralized coordination leads to the emergence of social order, bolstered and reinforced by the emergence and evolution of informal and formal institutions grounded in the sympathetic process. Social order grounded in this sympathetic process relies on a sense of interconnectedness and on shared meanings of actions, and the mirror neuron system predisposes humans toward such interconnection.     

Happiness and its molecular fingerprints

Happiness and well-being are in part heritable, but modifiable traits. The promotion of well-being and happiness, much like the primary prevention of non-communicable diseases (NCD), will become increasingly important in a world that is facing an NCD epidemic due to demographic aging and urbanization. The costs for the often lifelong treatment of NCDs are already high and may increase further with the arrival of expensive personalized medicine. The effective promotion of happiness at the individual and population level in order to guide policy requires a causal and mechanistic understanding of its modifiable determinants. With more than half of the world’s population living in cities, it becomes, for example, important to understand how environmental, social, and lifestyle characteristics of urban life influence well-being. Yet, the correlation between many of these factors and the fact that they act in concert poses a large challenge in causal inference. The -omics biomarkers which form a pillar of personalized medicine are at the same time essential research instruments of modern-day observational epidemiology. The paper discusses how they can be applied to overcome the challenges researchers face in studies on the association of complex risk and protective patterns with specific well-being phenotypes and their relation to diseases. Important concepts are discussed in the context of well-being that were recently developed by epidemiologists to stimulate more investments into the understanding of the modifiable part of health (e.g., Exposome; Meet-in-the-Middle; Mendelian Randomization) to match the huge investments that went into genetic research.     

The Austrian theory of relational goods

In modern rich societies, the traditional positive correlation between income and happiness seems to have disappeared: even though their income keeps rising, people do not declare themselves to be happier. This problem, which is known in literature as the “paradox of happiness”, has been thoroughly studied. One of the possible explanations is based on the observation that an income increase can sometimes entail the destruction of those relational goods on which happiness largely relies: relationships of family, friendship, love and fellowship. This research aims to show how, in the age of Marginalism, the most important attempt at establishing if and in which sense relational goods are economic goods is carried out by the very Austrian economists who led Robbins to write the epistemological statute of modern economic science.     

More and none? Children and parental well-being: A bimodal outcome from an instrumental variable approach

We examine the effect of the marginal child and the total number of children on self-reported well-being as a proxy for happiness. Prior literature has not controlled for endogeneity. We propose an instrumental variable approach which remediates the existing endogeneity problem, and generates a non-linear marginal effect and a bimodal distribution which explains why prior research arrived at competing positive, negative, or inconclusive outcomes. We provide evidence in support of a "parenting happiness gap" where happiness declines after the birth of the first child; however, beyond the first child additional children have a significant, positive and increasing effect on well-being. Confirmed by evidence from sociology and psychology literature, we consider possible channels which explain these results and discuss their policy implications in the context of fertility, labor market and health outcomes.     

Psychological War in Vietnam: Governmentality at The United States Information Agency

ABSTRACT

The United States Information Agency (USIA) has received little sustained scrutiny from critical military geographers, despite the major role it played in waging the Cold War. This article outlines the USIA’s role in waging psychological war in support of the US mission in Vietnam, notably its establishment in 1965 of the Joint United States Public Affairs Office (JUSPAO). Through an analysis of USIA operations, this article argues that psychological war can be understood as a governmental strategy to exert power over the people and territory of Vietnam. Through an examination of problems related to evaluating and conducting research for psychological war, this article questions the extent to which the United States succeeded in establishing this power, concluding that the effects of psychological war in Vietnam were, at best, inconclusive, and offer little evidence to support contemporary strategies to ‘win hearts and minds’.     

Choices, situations, and happiness

This article explores some conceptual issues in the study of well-being using the traditional economic approach of inferring preferences solely from choice behavior. We argue that choice behavior alone can never reveal which situations make people better off, even with unlimited data and under the maintained hypothesis of 100% rational choice. Ancillary assumptions or additional forms of data such as happiness measures are always needed. With such ancillary assumptions and additional data, however, the use of revealed preference to study well-being can be significantly improved, so that the choices people make can jointly identify preferences, mistakes, and well-being.     

Merchant and regulated transmission: theory, evidence and policy

Economists acknowledge the problems of regulated transmission but have different views on the likely efficiency of merchant transmission. This paper first examines the evidence on alleged market failure and regulatory failure as experienced in practice in Australia, where there have been both regulated and merchant interconnectors. Merchant transmission has generally not exhibited the standard examples of market failure but regulated transmission generally has exhibited the standard examples of regulatory failure. Imperfect information??more specifically, in the form of lack of coordination??has often been a challenge whatever the approach. Experience in Argentina suggests that transactions costs are not a barrier to negotiation and efficient investment determined by users. Policy should seek to improve the regulatory framework and to remove barriers to private initiatives. An important role for regulation is to facilitate coordination between potential providers and users of transmission lines.     

Does Off-Farm Wage Employment Make Women in Rural Senegal Happy?

This paper investigates the impact of wage employment on women’s well-being in the Senegalese horticultural export industry. It uses a subjective well-being approach, based on self-reported happiness, to capture income and non-income aspects of employment. The study uses original survey data from 2013 for the Saint-Louis region in Senegal and an instrumental variable approach, supported by information from focus group discussions. It finds that women’s employment improves subjective well-being for the poorest women, but not for women whose household income is above the poverty threshold. Women’s employment improves women’s happiness through an income effect, as it leads to higher income levels and improved living standards, but the non-income effects reduce women’s happiness. This negative effect is related to a higher workload and low job satisfaction due to unfulfilled expectations. The positive income effect outweighs these negative non-income effects for poor women but not for relatively wealthier women.     

所得、快乐与赋税:基于黄有光快乐经济学的审视

根据黄有光的快乐经济学,人们追求的最终目的是提高福利,因而经济学探讨的中心问题是福利或快乐.由于快乐是一种主观感受,因而GDP并不是衡量福利的一个有效指标.在现代社会中,生活品质不仅与私人品的消费有关,更与公共品的质量和数量有关.因此,在未来社会中,公共开支确实会且应该不断增长.为了应对不断增加的公共支出,政府就需要提高累进税,尤其是提高钻石商品的税收.     

Maximising Happiness?

The measurement of individual happiness challenges the notion that revealed preferences only reliably and empirically reflect individual utility. Reported subjective well-being is a broader concept than traditional decision utility; it also includes concepts like experience and procedural utility. Micro- and macroeconometric happiness functions offer new insights on determinants of life satisfaction. However, one should not leap to the conclusion that happiness should be maximized, as was suggested for social welfare function maximization. In contrast, happiness research strengthens the validity of an institutional approach, such as reflected in the theory of democratic economic policy.     

Open issues in happiness research

Happiness research is one of the most vivid and fruitful parts of modern economics. The focus is on empirical findings. In contrast, theoretical work has been rather neglected. The paper deals with three areas needing more analytical work: the choice or imposition of comparison or reference groups; and the extent, speed and symmetry of adaptation to positive and negative shocks on happiness. In both areas, theoretical propositions are derived which can in the future be empirically tested. The third area relates to the political economy of happiness. Many governments intend to take the happiness index as a criterion of how successful their policies are. As a consequence, survey respondents get an incentive to misrepresent their happiness level, and governments to manipulate the aggregate happiness indicator in their favor. A country’s constitution must induce governments to carefully observe human rights, democracy, the decentralization of political decision making, and market institutions and provide people with the possibility to acquire a good education and find a suitable job.     

家庭幸福的概念与指标体系的构建

家庭幸福是家庭发展的高级阶段。对家庭幸福领域进行研究,有助于构建相关的社会政策,保护家庭发展能力,提升家庭的幸福感受。将家庭幸福界定为家庭客观层面的状况映射到个人意识层面的主观感受,认为家庭幸福可能具有整体性、互动性等特性。在明晰界定的基础上,构建了家庭幸福的衡量框架,并利用调查数据作了实证分析。