Be happy! (Or else…)

It has been a busy and dyspeptic week. by William Davies has been the perfect accompanying reading material. The enthusiasm of many of my fellow economists for behavioural economics has made me increasingly uneasy. This is, after all, a profession strongly  inclined towards social engineering, and I’ve written here before about the likelihood that nudges are seen as an exciting new tool for this job. After all, they seem to work, and as even the status quo is a nudge, why wouldn’t you design better nudges to deliver better outcomes?

[amazon_image id=”1781688451″ link=”true” target=”_blank” size=”medium” ]The Happiness Industry: How the Government and Big Business Sold us Well-Being[/amazon_image]

eloquently reinforces my suspicions. It locates the fashion for “well-being” in the long tradition of making the internal world measurable and reducing questions of morality and political choices to scientific decisions. Economics, rooted in , plays a leading role in the story, as do the successive waves of management science from Taylorism on. Indeed, in management, the growing surveillance of employees’ ‘well-being’ by wearable devices is the latest version.

Davies points out there is an inconsistency at the heart of this: “Workplaces put a growing emphasis on community and psychological commitment, but against longer term trends towards atomization and insecurity. We have an economic model which mitigates against precisely the psychological attributes it depends upon.” Yet the emphasis on resilience or mindfulness puts all the onus on the individual to adjust: “one progressive route would involve changing [the] context. But another equivalent would be to focus on changing the way it is experienced.”

He is also critical of the economists’ use of the idea of revealed preference: that you can infer somebody’s inner preferences or desires from their choices, usually their choices about what to spend their money on. Shopping speaks louder than words. Perhaps wearables that can measure heart rate or sweat will replace money as the best revealed preference metric, but meanwhile what someone spends is a readily-measurable indicator, easier to count and compare than what people say about their emotions. “This granted money an exceptional psychological status, as it allowed others to peep into people’s private desires.”

Disliking money as a metric, Davies is therefore also critical, as many people have been, of using the technique of contingent valuation to put monetary values on, say, the impact of an environmental disaster. “What we witness in this sort of example is economics becoming used as a basis for broad public agreement well beyond the limits of the market place,” Davies writes. He’s in good company. and are among those who dislike the use of money as a measure of non-monetary values, such as nature, or relationhips, or civic virtue.

However, this seems to me distinct from the reductionism of the behavioural economists and psychologists. It is one answer to the question of how you resolve conflicts when there is no market: if you have to make interpersonal comparisons, how should you go about it? Or, in the words of a well known survey article, is some number better than no number? If you want to calculate compensation after an oil spill, how else could you go about it? So I am far more comfortable with these valuation techniques than I am with the happiness tendency.

On the latter, my instincts are with Davies: ” Behaviourism stretches Bentham’s dream of a scientific politics to its limit, imagining that beneath the illusion of individual freedom lie the cold mechanics of cause and effect, observable only to the expert eye.” When I teach my students behavioural economics – and they’re very interested in it – I ask them to look at this Adam Curtis blog, From Pigeon to Superman and Back Again. While not dismissing the policy sense of some nudges, beware economists who know how to make you happy and beware even more bosses demanding it of you.

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3 thoughts on “Be happy! (Or else…)

  1. Pingback: Be happy! (Or else…) | Homines Economici

  2. I had a mega-binge on Adam Curtis documentaries a few months back…. very nice to know that you point your students to him. Hopefully he can nudge them away from behavioural economics (and behaviourism).

    I think as the Curtis piece shows, you can’t really take behaviourism without considering psychoanalysis….. they seem in some sense, reactions to one another. Economics though, because of its claim to the authority of science, allies itself to behaviourism and negates psychoanalysis – behaviourism more closely reflects the dominate scientific paradigm. For me, a much longer historical perspective is helpful in unlocking the difficult problems; of money as measure of value, community and psychological commitment VS atomization and insecurity, etc

    I always rave about Joel Kaye’s little book Economy & Nature….. but he’s recently brought out another one – A History of Balance 1250 -1375 http://www.cambridge.org/gb/academic/subjects/history/european-history-1000-1450/history-balance-12501375-emergence-new-model-equilibrium-and-its-impact-thought – a review of that would be handy (hint, nudge!) cos I can’t afford it new!

    Its these deeper historical perspectives about the early development of scientific thought itself in the context of theology, morality and money which, for me anyway, offer more promise. Ultimately, we want to know whether behaviourism is a good way to understand what it is to be human…. and much of that question is about the relation of knowledge and being…. does how and what we know, affect who and what we are? You can’t expect politicians to consider these sorts of questions – if behaviourism looks like it works in the short term, they’ll use it. But academics should and must.

    Thanks for the review. I’m glad you’re uneasy.

  3. Oh Zeus, not Skinner, anything but deleted deleted Skinner. I was there and it was not nice. Not so much behavioural but at least mind bending and perhaps mind destroying.

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