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Along Cambodia’s Tonle Sap River, displaced Vietnamese families live on floating villages. Their homes, made from plastic drums and wooden planks, rise and fall with the tides. They use the river not only as a toilet, but for bathing and drinking. This week, I visited some of these communities with the Australian Health Humanitarian Aid on our annual mission. We were able to distribute essential food supplies to over 1000 families, and alongside volunteer doctors provided crucial medical treatment. One case that has really stuck with me was an 80-year-old man post-op after a cataract surgery. A cataract is the clouding of the lense of the eye, which causes foggy/blurry vision. After a simple 15-minute procedure, I watched as the opthamologists removed the gauze from his face - restoring his vision. For the rest of the day, he walked the halls of the local hospital's gardens - touching the plants and gazing up at the sky. And that evening, he would return to his family, and get to finally see his granddaughter's face for the first time.
It's life changing experiences like these that have drastically shift my perspective on happiness. Beyond a mere
emotion, this experience shifted my perception of happiness as a complex psychological phenomenon – essential to establishing
ones’ individual wellbeing. Through acknowledging the limitations of quantifying happiness and its correlation to income, I find myself with
a renewed appreciation of emotional fulfillment, in both an economic and personal sense.
What's the Economics of Happiness?
Welfare economics tell us utilitarian humans act according to homo-economicus: the self-interested pursuit of happiness based on assumptions of utility maximisation and rational decision making (White, 2019, pp. 41-50). However, if everyone were self-interested, why would we engage in teamwork or generous acts? Kant’s deontological ethics attempts to reconcile this contradiction by defining autonomy – the ability to take actions that may not fulfil our own preferences but are ‘morally’ correct (White, 2019, pp. 50-57).
For example, take standing up to give my seat to an elderly lady on the bus. Whilst I do not gain immediate ‘utility’ from standing up, the
elderly lady feels more energetic once she reaches her chiropractor appointment. So, rather than maximising my individual utility, my
virtuous decision improves the overall societal welfare function by increasing aggregate utility for the community (Schneider &
Byung-Cheol, 2020; Table 1). This idea sparked my first perspective shift: the pursuit of happiness is not individual, but a journey for all
of us towards society’s greater good.
However, our willingness to help others depends on our individual value judgements – not every bus passenger would be willing to stand (Rojas, 2019, p. 141). Thus, conflict arises for policymakers: should they target policies that maximise wealth, or improve wellbeing?
Does Money = Happiness?
The Easterlin Paradox brings these factors together by proposing a positive correlation between GDP (more simply, income) and happiness (Figure 1). It argues once wealthy countries have enough income to satisfy basic needs, additional income buys less (if any) extra happiness (Stevenson & Wolfers, 2008).
To assess its robustness, I reflect on Cambodia and seeing the smiles of gratitude on families’ faces as we offered them blankets and rice
bags – relieving only a small part of the stress they suffer each day. As such, I would agree that meeting Maslow’s first tier of
physiological needs is vital to solidifying a sense of security (Pietro, Silvia, & Giuseppe, 2014). However, beyond these bare
essentials, I'd argue happiness’ definition adapts to be entirely independent to income. For example, placing these
families in a proper home vs. hotel would make little marginal impact to their happiness. My new belief? No matter how rich one becomes,
true happiness lies in belonging, community, and self-realisation. This cannot be achieved with income alone.
An alternative theory to Easterlin is the Great Gatsby Curve (GGC). Whilst Easterlin measures happiness between countries,
GGC utilises relative income comparison to measure happiness within countries using income inequality (Peng, 2021).
Utilising the horizontal axis of Gini coefficient (a measure of income inequality wherein 0 = perfect equality), and vertical axis of
intergenerational elasticity (measuring strength of the link between economic status of parents and their children), GGC shows as income
inequality increases, social mobility decreases (Machin & Major, 2024; Figure 2). For example, take a low-income American individual.
They would be more unhappy living in the US as opposed to, say, Denmark - because their relative income is lower (Layard, 2005). By
measuring income as relative rather than absolute using GGC, I could adapt the Easterlin's initial correlation between income and happiness
to show that it is in fact when income inequality increases (not merely income alone), that relative happiness decreases.
Linking the theory back to our world...
All this happiness talk reminded me of a movie I watched a few years ago - The Pursuit of Happyness (2006). The movie follows Chris Gardner (Will Smith), a single father evicted from his apartment with no place to go. Trying to create a better life for him and his son, Chris lands a job as an unpaid intern at an investment firm. Through sheer determination and hard work, he eventually passes the exams and interviews and achieves the one open role he wanted. The fact is, if we want to achieve happiness and fulfillment, it's up to us to throw ourselves in the journey, the challenges, the failures - learn from them, build ourselves back up, and become better connected with ourselves.
The Key Lies Within Us
Don't forget that happiness looks different for everyone. I like to use the example of our primates - imagine, long ago, when we were monkeys in the wild.
I'd imagine the daily sense of purpose was pretty simple: finding food, taking care of your monkey kids (if you had them). Right? Now, enter "society". Most people still farming, still raising kids, and only a few real options to fulfil us. Then as we continued to develop, gain more skills in feeding, taking care of ourselves, and eventually these formerly clear and basic physical needs shifted over to the need for lots of money, status, power.
The fact is, these things are all completely immaterial - manufactured by modern day "society". It's all too easy to succumb and let these factors define our happiness. After all, by abiding to those rules, we help capitalism function. But the fact is, we still have agency. Your life is still in your hands.
We find ourselves in a new renaissance. So many options for fulfillment, so many doors to open on our journeys. Kant's dentological ethics holds true: it's up to us!
So, if you take one thing from this short essay, take this: by harnessing our individual power in the
broader societal welfare function, we can accomplish our own purusit of happiness. Be yourself, stick to your value judgements, and
happiness will find you.