Wealthy people have a greater potential to suffer than the poor.
A True Smile
Originally uploaded by ~FreeBirD®~.
Think that statement is controversial? Here is some more:
Being more wealthy than others, and particular your peers, makes you feel happier; Being poorer than others, particular your peers makes people unhappy. One of the greatest sources of happiness are sound relationships.
These and other revelations came from a book I recently read. The book Happiness, Lessons from a new science, from the pen of Richard Layard, a Professor in Economics at the London School of Economics makes claims that will annoy and please left and right wingers alike.
And it makes for interesting insights when applied to South Africa.
The study of happiness in economics is very new but growing rapidly world wide. But why study happiness?
Traditionally, especially in western democracies and Japan, politicians and economists have aimed for maximising economic growth. The argument was that the greater wealth of the population, the greater the feeling of well-being.
For some time now however, economists have noticed that although wealth have increased in the west, levels of happiness have not. In fact in most western countries levels of happiness have actually started to decline even when levels of wealth has grown.
It would seem that once a population reaches a certain level of wealth, becoming richer does not add to a sense of well-being.
Adaptation: As people get used to higher income levels, their idea of a sufficient income grows with their income. If they fail to anticipate that effect, they will invest more time for work than is good for their happiness.
Layard explains that reason why happiness is decreasing in wealthy societies is exactly that in attempts to earn more money, individuals have less time.
And less time means a decline in relationships in general and the quality of relationships. And quality relationships along with good health is one of the prime ingredients of happiness.
Another problem is that earning more often requires individuals to move and settle in different places. This movement and displacement is unsettling and also impacts relationships. It makes individuals unhappy.
A sense of belonging is also central to happiness. This militates against the idea of individuals alone in the big cosmopolitan city.
Layard's research is a strong argument for government intervention to make society more equal. As I mentioned above being poorer than your peers is one of the main causes of unhappiness.
Social comparisons: In contrast to what traditional economics predicts, happiness is derived from relative income as well as from absolute income. That is, if everyone gains purchasing power, some may still turn out unhappier if their position compared to others is worse. This effect may not turn economic growth into a zero sum game entirely, but it will likely diminish the benefits people draw from their hard work. In an economy where not only companies, but individuals are constantly forced to compete with each other, life and work are experienced as a rat race.
But Layard's studies suggests caution:
Loosing what you have, is a greater cause of unhappiness than if you are already poor. A state should therefore be sensitive when introducing re-distributive policies as it can make a part of the population very unhappy.
There are many indicators that in the period 1994 - 2002 South Africans have become poorer. But since 2002 when many socials grants were introduced or broadened, the poor's wealth have indeed increased.
But inequality has increased throughout 1994 to now, and none more so than in between blacks themselves. As the closest peers to poor black SA, the huge difference between rich black SA and poor black SA is a huge potential cause of unhappiness.
There is another key insight Layard provides that might help to explain some of our own xenophobic violence. As I have pointed out, places where the violence broke out were poor, but not the poorest townships in South Africa.
The science of happiness would suggest that once you have a developmental state that looks after the poor, this poor will be less willing to accept outsiders that threaten what they have.
This is wholely consistent with the findings published in the Sunday Times that Mozambiquecans and Zimbabweans are less xenophobic than their neighbours - the relatively wealthy Namibians or South Africans.
Layards research can also be used in other ways to advance the cause of restrictions on immigration. Unstable populations where inhabitants do not know each other, are unhappier places than familiar tight knit communities.