Tag Archives: conceptualization

How to measure happiness (“prosperity”) across countries

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Here is a topic just perfect for a Research Methods class discussion about conceptualization and operationalization: how to measure happiness across countries. Here is a quick summary of how the Legatum Institute measured this and found that Norway is the happiest country in the world:

With this in mind, five years ago researchers at the Legatum Institute, a London-based nonpartisan think tank, set out to rank the happiest countries in the world. But because “happy” carries too much of a touchy-feely connotation, they call it “prosperity.”

Legatum recently completed its 2010 Prosperity Index, which ranks 110 countries, covering 90% of the world’s population.

To build its index Legatum gathers upward of a dozen international surveys done by the likes of the Gallup polling group, the Heritage Foundation and the World Economic Forum. Each country is ranked on 89 variables sorted into eight subsections: economy, entrepreneurship, governance, education, health, safety, personal freedom and social capital.

The core conceit: Prosperity is complex; achieving it relies on a confluence of factors that build on each other in a virtuous circle.

Ultimately how happy you are depends on how happy you’ve been. If you’re already rich, like Scandinavia, then more freedom, security and health would add the most to happiness. For the likes of China and India (ranked 88th), it’s more a case of “show me the money.” What they want most of all? The opportunity to prove to themselves that money doesn’t buy happiness.

Some quick thoughts on this:

1. This is a lot of dimensions and indicators to consider: 89 measures, 8 subcategories.

2. The change from “happiness” to “prosperity” is an interesting one. Happiness is indeed a fuzzy term. But prosperity often refers to material wealth in terms of income or buying power. This prosperity defined more broadly: material wealth plus freedoms plus level of services plus social interactions. The Legatum Website suggests the Index is “the world’s only global assessment of wealth and well-being.”

3. I would be curious to know how comparable the data is across countries and across the organizations that form and ask these survey questions.

4. In this complexity, it is interesting to note that prosperity means different things to countries in different stages.

5. Even with all of these measures, which measures are used and how this Institute weights these particular factors would matter for the outcome. For example, the story at Forbes suggests that improving a nation’s entrepreneurial culture could make a big difference in these rankings. And the United States is ranked #1 in health care because “$5,500 a year in per-capita health spending has resulted in excellent vaccination rates, water quality and sanitation.” The Legatum Institute itself seems to put a big emphasis on business.

6. How come so many of these lists come from Forbes? Beyond the answer that Yahoo has a deal with Forbes for content, this is an interesting way to drive web traffic: top ten lists that catch people’s attention. How useful these sorts of lists are is debatable but they are often interesting and quickly summarize complex areas of life.

Untangling the effects of income on happiness

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Examining the relationship between income and happiness can be tricky. A recent research study, conducted by two Princeton researchers and summarized by LiveScience, is illustrative of some of the issues in this research field:

-The researchers were working with a large dataset that is built around a daily survey of Americans: “they analyzed more than 450,000 responses to the Gallup-Healthways Well-Being Index, a daily survey of 1,000 U.S. residents conducted by the Gallup Organization.”

-Changes in income were measured in terms of percentages rather than absolute numbers. This was done to reflect the fact that a percentage change in income would be better for comparisons across income types. As the researchers note: ““In the context of income, a $100 raise does not have the same significance for a financial services executive as for an individual earning the minimum wage, but a doubling of their respective incomes might have a similar impact on both.”

-Survey respondents answered questions related to two measures of happiness: overall life satisfaction and what their emotions were the day before. According to the LiveScience article: “For life evaluation, participants indicated on a scale from zero to 10, from worst to best possible, how they would rate their lives. For emotional well-being, participants answered yes/no questions about whether they had experienced various positive and negative emotions a lot during the prior day.” Having both of these dimensions is critical as a general question about happiness might be interpreted differently (do the reseachers mean happy right now or overall?) by respondents.

-Some of the findings: having a “Low income seemed to magnify the emotional pain of life’s misfortunes, including divorce, illness and loneliness.” However, there was a tipping point of $75,000 where having more money didn’t help improve one’s well-being:

The researchers suggest that making anything more than $75,000 no longer improves a person’s ability to spend time with friends, avoid pain and disease and enjoy leisure time – all factors involved in emotional well-being.

“It also is likely that when income rises beyond this value, the increased ability to purchase positive experiences is balanced, on average, by some negative effects,” they write. For instance, a past study revealed a link between high income and a reduced ability to savor small pleasures, the researchers noted.

This tipping point of $75,000 is above the median income in the United States. I would be curious to know if individuals feel this tipping point when their income does rise to this level – are they cognizant of this point? Or once they reach $75,000, are they still locked into a mindset that having more money will lead to increasing levels of well-being?

Also, this $75,000 point could be quite fluid. Over time, this point would change based on economic conditions and cultural understandings of what is a “good income.”

Older age = more wisdom, happiness

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In a youth-oriented culture like that of the United States, growing older may not appear appealing to many. But recent research suggests that growing older leads to more wisdom and increased levels of happiness:

Contrary to largely gloomy cultural perceptions, growing old brings some benefits, notably emotional and cognitive stability. Laura Carstensen, a Stanford social psychologist, calls this the “well-being paradox.” Although adults older than 65 face challenges to body and brain, the 70s and 80s also bring an abundance of social and emotional knowledge, qualities scientists are beginning to define as wisdom. As Carstensen and another social psychologist, Fredda Blanchard-Fields of the Georgia Institute of Technology, have shown, adults gain a toolbox of social and emotional instincts as they age. According to Blanchard-Fields, seniors acquire a feel, an enhanced sense of knowing right from wrong, and therefore a way to make sound life decisions.

That may help explain the finding that old age correlates with happiness. A study published this year in the Proceedings of the National Academy of Science found a U-shaped relationship between happiness and age: Adults were happiest in youth and again in their 70s and early 80s, and least happy in middle age. A 2007 University of Chicago study similarly concluded that rates of happiness — “the degree to which a person evaluates the overall quality of his present life positively” — crept upward from age 65 to 85 and beyond, in both sexes.

These are interesting findings. Now how could American culture go about showing and sharing these benefits of growing old? Wisdom, in particular, might be a challenge to portray in commercial advertisements.

Also, there is an interesting discussion in the article about how to define and measure “wisdom.”