Empirical Analysis of the Relationship Between Military Endeavor, Economic Growth and Happiness (original) (raw)

The relationship between economic growth and happiness

Pressacademia, 2021

Purpose-The purpose of this study is to analyze the relationship between economic growth (or economic performance) and happiness (life satisfaction, well-being). Happiness economics is a very contemporary research field, attracting economists, sociologists, psychologists and other scientists to investigate it, yet there is many rooms for exploration. Money is not everything, so how much does it matter precisely? This debate has divided the researchers in two parties: the ones who are arguing that economic growth and happiness go hand in hand and the ones who say that there is no relationship between these two concepts and because of this fact the constant aspiration for economic growth lost its meaning, and does more harm than benefit. Methodology-We started by analyzing the accurate and detailed definition of the GDP and include information about it in order to better understand its function and applicability. In the following, we have analyzed the concept of happiness, the way it can be defined and measured. Then, we have analyzed the given economic theories which relate to these two concepts and describe a relationship between them. We analyzed four countries (Denmark, Costa Rica, Romania, and India) mostly based on their economic and well-being situation, and the available indicators which have an effect on well-being. We examined these countries because two of them had a very high level of wellbeing, one had a medium level and one had a low level of well-being. There were examples where the money had a good effect on happiness and also where not. In Denmark and Costa Rica money was not the only (or any reason) because for the high level of well-being, other factors, not really related to money, were high as well. In Romania, the GDP and happiness have increased at the same time. In India, the increasing GDP has brought in fact diminishing happiness. Findings-In our paper, we have found out that there are various theories built upon this question, as controversial studies and opinions. Some researchers say that GDP has no effect on the level of well-being. On the contrary, more recent studies generally prove the other side, that GDP and happiness go hand in hand. There was one common factor in almost every research: money has a diminishing marginal utility on happiness, for a very poor country additional income does bring a high level of happiness, but for a very rich country it is almost invisible. It needs to be mentioned that growth and development do not concern just quantitative increases in production, consumption, income, or any other measures. They generally also involve qualitative changes, like education, healthcare, or political freedom. These factors certainly develop the level of well-being in a country, and for their development, there is a need for economic growth. On the other hand, economic growth does not guarantee the development of these factors, as we can see in the example of India. In my opinion, the best approach is not to focus on economic growth anymore, but on the question, how could we use this growth in GDP in order to improve our conditions and make people happier? Conclusion-Meanwhile measuring happiness is much more complex, although we have many measures trying to assess it: Gross National Wellbeing, Happiness Index, Genuine Wealth Index Happy Planet Index, OECD Better Life Index, Human Development Index, Well-being index, Social Development Index, and many others, but they are not widely accepted because of their subjectivity and non-accuracy. Even more, it is much more difficult to improve these measures in a country because they depend on many factors, some of which are not even entirely clarified than to improve GDP, which relies on objective, strictly numerical measures. The starting point of nearly every happiness and welfare measure is self-reported happiness, which given its nature is very subjective. This fact again provokes skepticism and antipathy in many people's minds and tends to state that these measures are not relevant and should not be based upon. Economic growth is one indicator that is widely used and analyzed, but happiness indicators are not so frequently discussed. On the other hand, we think there is a need to do it, that is why there is an emerging interest among researchers towards it.

Happiness, Growth, and Public Policy †

Economic Inquiry, 2013

If society's goal is to increase people's feelings of well-being, economic growth in itself will not do the job. Full employment and a generous and comprehensive social safety net do increase happiness. Such policies are arguably affordable not only in higher income nations but also in countries that account for most of the population of the less-developed world. These conclusions are suggested by an analysis of a wide range of evidence on happiness in countries throughout the world.

Happiness and Economic Performance*

The Economic Journal, 1997

If a nation's economic performance improves, how much extra happiness does that buy its citizens? Most public debate assumes-without real evidence-that the answer is a lot. This paper examines the question by using information on well-being in Western countries. The data are of four kinds: on reported happiness, on reported life satisfaction, on reported job satisfaction, and on the number of suicides. These reveal patterns that are not visible to the anecdotal eye. In industrialized countries, well-being appears to rise as real national income grows. But the rise is so small as to be sometimes almost undetectable. Unemployment, however, seems to be a large source of unhappiness. This suggests that governments ought to be trying to reduce the amount of joblessness in the economy. In a country that is already rich, policy aimed instead at raising economic growth may be of comparatively little value.

Happiness and Economic Growth – The Evidence

Global Handbook of Quality of Life, 2014

Happiness and Economic Growth: The Evidence * Long term trends in happiness and income are not related; short term fluctuations in happiness and income are positively associated. Evidence for this is found in time series data for developed countries, transition countries, and less developed countries, whether analyzed separately or pooled. Skeptics, who claim that the long term time series trend relationship is positive, are mistaking the short term association for the long term one, or are misguided by a statistical artifact. Some analysts assert that in less developed countries happiness and economic growth are positively related "up to some point," beyond which the association tends to become nil, but time series data do not support this view. The most striking contradiction is China where, despite a fourfold multiplication in two decades in real GDP per capita from a low initial level, life satisfaction has not improved.

A Note on the Measurement of the Relationship Between Happiness and GDP

Applied Studies in Agribusiness and Commerce, 2016

This research note compares the results of the measurement of the relationship between happiness and GDP in the EU based upon unweighted data with the results based upon weighted data. The data are weighted in order to correct for the different sizes of the populations in the EU countries concerned. The result of the weighing is an even stronger relationship between happiness and GDP per capita than in the case with unweighted data.

Macroeconomic Factors Affecting Happiness

International Journal of Business and Development Studies, 2013

This paper examines factors affecting happiness using panel data concerning 58 countries during 2003-2011. Happiness data come in the form of answers to questions such as "How happy are you as a whole in your life?" and the answers range from 1 to 5transformed to obtain a 1-10 scale. Macroeconomics data are from MIT and World Bank 2012 tables. Including 215 total pool observations indicate the negative and significant effect for Inflation and Unemployment while positive and significant for Growth of GDP Per Capita and the Government Expenditure. Controlling these variables Islamic countries are relatively less happy.

Economic Growth and Happiness in Nations between 1946-2019: The Demise of the Easterlin Paradox

., 2024

The Easterlin Paradox held initially that income adds to happiness at the micro-level of individuals but not at the macro-level of nations. That claim has been mitigated over the years, first that economic growth does not add to average happiness in nations and the last version holding that economic growth does not add to happiness in the long-run (Easterlin and O'Connor 2022). We checked that last claim in an analysis of 118-time series on average happiness in 48 nations that involve at least 10 data points over at least 20 years. We found a considerable correlation between the change in GDP per capita in nations and the change in average happiness. r = +0.28. On average, a yearly 1% economic growth was followed by a 0.0035 gain in average happiness in a nation. Differences with the study of Easterlin and O'Connor are discussed.

Economic Growth and Happiness: A Cross-Nations Path Analysis Model

This paper directly and indirectly examines the impact of economic growth on happiness, with human development as moderator variable. Cross-nations data on economic growth, human development, and happiness indices were collected from 124 countries and employed in a path analysis model. The results show that economic growth had a direct negative and significant impact on both happiness and human development. Meanwhile, human development had a positive and significant direct impact on happiness. Indirectly, through moderator variable human development, economic growth again had a negative and significant impact on happiness. An implication of this finding was that economic growth is no longer a single important factor of a development indicator. It is then suggested that human development, rather than economic growth, sustainably be promoted in order to make everyone always feels happy.

Happiness and Public Expenditure: Evidence from a panel analysis

2017

The present study examines empirically the relationship between Happiness and public spending. We use a panel data from 2006 to 2015 for about 132 countries. We first estimated a Pooled, fixed effect and finally a GMM model to deal with the endogeneity problem. Our main findings suggest, first, that high levels of public expenditure are associated with greater Happiness around the world. Second, as expected, social support, Healthy life expectancy, Freedom to make life choices and confidence in national government contribute significantly to Happiness.

International evidence on the economics of happiness and its impact on nation growth and fertility

2015

Recent literature on developed countries have shown evidence that, despite enjoying rapid growth and higher levels of material well-being, the people in these countries do not necessarily enjoy higher levels of happiness. In fact, there appears to be a declining trend in the levels of happiness among the majority, and this is believed to be related to an increase in stress-related illnesses that could bring about a decline in productivity, reductions in fertility rates; a decline in social trust, a rise in suicide rates, an unprecedented increase in crime rates and a rapid degradation of the environment. Further investigations must be carried out to determine what enables or hinders happiness, so that nations can make informed policy decisions that are necessary to ensure sustainable economic development takes place, while improving mankind’s happiness. This study examined the economic determinants of happiness and its impact on economic growth and fertility, based on the Set-Point,...