The "dismal science" goes happy

For many years, economists have eschewed emotion in their study, assuming that choices in the marketplace are simply rational 1-0 on/off things and that choices accurately reflect what people actually want. But with advanced brain science and good old survey techniques, some economists are delving into the idea of happiness once more and finding that some choices aren't really based on happiness or that humans can often be a poor judge of what will make them happy.

The general rule is that experiences make people happier than things. A trip to Hawaii, for example, trumps a BMW M5. But things can also sometimes contribute to happiness:

before [one economist] scoffs at Gillette's latest five-blade shaving system, he should recall Benjamin Franklin's belief that teaching a young man to shave, and keeping his blade sharp, would contribute more to his happiness than giving him 1,000 guineas to squander.

The other interesting bit is on social competition. Humans, like many primates, don't just want to be happy. Part of happiness is to be at the top of the pecking order, to be better than our peers, a condition some sociologists call "affluenza." In the Overspent American, Juliet Schor also notes that affluenza is worse in modern times, where television allows us to have peers that are substantially better off than our actual social group, putting even more pressure to one-up.

Anyway, it's good to know that economists are getting down to the issue of what makes us happy, and understanding that not all marketplace decisions are rational, happiness-maximizers.