Tag Archives: London School of Economics

Are You Happy?

On Friday, I went to see two Iranian documentaries playing at the British Museum. The second of these documentaries, directed by Ali Tamadon and entitled “Are You Happy?”, sees the film crew visits different areas of the country and ask local families this most fundamental of questions. Throughout the 50+ minutes of tape, the range of responses continued to surprise me. Most people — perhaps out of shyness, naivete, or sheer optimism — claimed to be happy in their lives. A few of the more nuanced responses stood out to me:

– A middle-aged mother discussed how happiness and sadness are two sides of the same coin. To know one, you must know the other.

– A teenage boy, squirming in front of the camera, confesses to being unhappy, full stop, but begs the director to not force him to reveal why.

– An old woman, who looks to be in her 80s, talks of hardships and the deaths of her loved ones. She prays to Allah that she will be taken to a place where these burdens will be taken away.

– A Tehran-based documentary filmmaker claims he is happy only when he is allowed to speak his mind and express freely what he sees around him.

The film never bored. The camera frames were beautifully set and simple, showing the interviewee in his home with his family in the background. It drove the point home to me that happiness (or contentment, as I prefer to think of it) is a mindset and is only tangentially linked to actual events of your life.

This truth was echoed in the memoirs of a young autistic savant, which my friend Stephane sent me. Called Born on a Blue Day, it describes the life of 27-year-old Daniel Tammet, the oldest of nine children born to a poor East London family. Tammet’s childhood could be seen as brutal: several bouts of epilepsy, Asperger’s syndrome, poverty, homosexuality, and social dislocation at home and school. Despite all this, he manages to find a decent life for himself by just being upfront, embracing his savant abilities, and openly admitting his quirks and apparent ineptitudes.

This focus on happiness is particularly useful in a time when material excess is increasingly the norm in the developed world. Clothes, appliances, furniture — even houses, for that matter — are increasingly made to be disposable. Fat middle-aged Americans are now making way for fat Chinese children. Almost 1/3 of the food purchased and brought home in the UK is thrown out. Something doesn’t seem right.

This debate has even entered the academic world. While studying at the London School of Economics, I came across the work of Richard Layard, one of the university’s professors who has pioneered a branch of economics that he refers to as “happiness economics.” Rather than allocating resources to maximise wealth, Layard argues that they should be allocated to maximise people’s happiness. A simple enough premise to argue for, but how do these models differ? When measuring optimal economic outcomes, he claims that neo-classical economics fails to consider (or purposefully disregards) the psychologically damaging impacts of inequality, the implicit costs of our evolving tastes, and our path dependency for material objects which we have grown accustomed to. The effect is a society which works harder than it should and is less happy (Incomes contribute to greater happiness, studies suggest, only up until $10-15,000 US dollars annual income… maybe that’s why so many Japanese are committing suicide…)

And Layard is not alone in the academic world. Other economists, such as Cornell University’s Robert Frank, argue for an entirely new form of taxation which is based on consumption rather than earnings (Look out for his book Luxury Fever for a more detailed explanation). Frank argues that high wage-earners who save their money should not be disincentivised from being productive; tehy are, in fact, facilitating future investment (either directly or through middlemen such as banks) by saving what they have earned. On the other hand, the more they consume, on average, the more they should be taxed, with items considered most luxurious taxed at the highest rate. This way, non-productive consumption could still have a place in the market, but its social cost (in terms of the inequality it produced) would be more properly reflected.

My Dissertation on Chinese Property Rights

Trying to understand how China has managed its economic development over the last 35 yearsis no simple task.  But what I find most fascinating about economic development is how leaders are able to bring the general population along with them on the journey.
It certainly does not hurt to bring extra money into people’s pockets, but what about those who do not benefit from new political decisions?

This is the question I tried to understand more fully in my research while at the London School of Economics.  My dissertation looked at how different sectors in China (government, business, and civil society) coped with and kept in check each other’s vested interests as they set out to redevelop China’s cities after almost a half century of Communist oversight.  I looked specifically at a massive mixed-use development project called Oriental Plaza in the heart of Beijing (at Wangfujing) and specifically at how workers and businesses jockeyed with government officials during the construction period and how they coped with the shift from state-owned urban land to privately held land-use rights.

The result shows how institutions can be cultivated incrementally and creatively to achieve results that might not be ideal but are ideal for the given moment in time.

You can download the pdf here: http://www.lse.ac.uk/collections/DESTIN/pdf/WP81.pdf