Intro sequence: Street scene, ESRC logo and series title.
Seven days of social science research
(Child's voice:) The child that is born on the Sabbath day is bonny and blithe and good and gay.
(Caption:) Happiness and wellbeing

Footage: Market trade stalls.

Professor Andrew Oswald:
My name is Andrew Oswald,  I'm a Professor of Economics at the University of Warwick. I've worked on what's become known as the economics of happiness and wellbeing for the best part of 20 years. So this goes back to the early 1990s, when one or two colleagues and I just asked ourselves: 'Why do we do economics research in the first place? Why would we care about these things?'. And the more that we thought about that, the more it seemed: 'Well, the reason is of course we're trying to understand what makes people really happy'.

Interviewee 1:
You can have loads of money, but you can still be unhappy, couldn't you?

Interviewee 2:
It helps, but I don't think it's that important.

Interviewee 3:
But probably it does oil the wheels.

Caption: Markets, money and happiness 

Professor Andrew Oswald:
It's not that money and exchange rates and inflation and unemployment matter in themselves. It's because those things - those phenomena, those forces in society and the economy - are probably big influences on human wellbeing.

Interviewee 4:
You know, I wouldn't say no to winning the lottery, but you read about people who've won it and then wish they hadn't.

Interviewee 5:
No, I don't think money makes you happy, no. No, but I think it'd do exactly the opposite if you get too much of it.

Professor Andrew Oswald:
If I ask you and listen to your answers, you've got a pretty good idea of how much you're enjoying your life. And one person's answers might not be very revealing, but let's imagine we have 100,000 randomly sampled people like you, or even one million, then I can look across the patterns in all of the answers. And in that way we believe as researchers we can learn about the true determinants of human happiness.

Interviewee 6:
Well, shall I tell you that I'm 89, so...

Interviewee 7:
What age were you happiest then do you think, mother?

Interviewee 6:
I don't know, I don't know. I was happy when I had my children small, I'm happy when now they're all off my shoulders.

Professor Andrew Oswald:
There are very strong links with whether or not you're married, whether you're unemployed, how rich you are, your age, your gender, your physical health, whether you eat fruit and vegetables - all sorts of factors like that. And if I said to you: 'How happy does eating fruit and vegetables make you', or 'How happy does your marriage make you', you would find it extremely difficult to give an exact figure. But statistically, by averaging across all the people in our samples - not just Britain or America, all over the world - we can calculate the amount of happiness that seems to be derived from these extraneous events, or these life events.

Interviewee 8:
The only thing about older age is decrepitude. You think 'oh, I can't do that because I'm'... But I'm still skiing.

Professor Andrew Oswald:
Physical health, as you might imagine, shows up very strongly in our happiness equations. Ill health towards the end of your life is, naturally enough, associated with a lot of unhappiness. But there are strong happiness effects, insofar as we can judge, from marriage, from being relatively old, not middle-aged. There are no links between having children and being happier. If anything, probably having children is a slight negative to your happiness - even though I don't tell my daughters that!

Interviewee 9:
I don't think that money can make you any happier than you already are. If you've got a nice family and friends, then I think you're happy enough, aren't you?

Interviewee 10:
It's not important if you've got plenty of money, but it is if you haven't!

Professor Andrew Oswald:
I would say that there's overwhelming evidence that money buys happiness, yes. Often journalists ring me up, and they're quite disappointed when I tell them, they prefer a more 'Nirvana' kind of view - but it's true that richer people are happier. But if I make everyone richer in your country, the great tide of GDP lifts all the boats together - there's a sort of generalised washing-out effect, a sort of neutralisation.

So although this is still debated, the balance of the evidence is that in Britain, if we get richer within the next 20 years, we will not get happier. Because subconsciously I'm seeking rank in society, I want to be higher than you. If you've gone up at the same time as me, then jointly we're not getting happier.

Interviewee 8:
This world is slightly too enthusiastic for more things, more material goods, which don't bring satisfaction.

Professor Andrew Oswald:
I think this research avenue is important for all kinds of reasons. The broadest is to try and get us away from focusing on incredibly narrow criteria for success of a policy or a society. The idea that a good measure of a terrific society is that it's rich in its BMWs and its beef burgers and its material possessions - I think we're past the point where that's a sensible way to characterise success in a country like ours.

I don't think we should abandon the capitalist idea of letting markets have an important role in society, because markets are quite efficient at doing some things. Ultimately, politicians need to work out how to create happier citizens - and maybe we've been over-emphasising, possibly for a hundred years, the role of income in all of that.

End credits with ESRC logo.
The Economics of Happiness - Professor Andrew Oswald, University of Warwick.