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Happiness and the Human Development Index: Australia Is Not a Paradox

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  • Leigh, Andrew

    () (Australian National University)

  • Wolfers, Justin

    () (University of Michigan)

Abstract

In "Happiness and the Human Development Index: The Paradox of Australia," Blanchflower and Oswald (2005) observe an apparent puzzle: they claim that Australia ranks highly in the Human Development Index (HDI), but relatively poorly in happiness. However, when we compare their happiness data with the HDI, Australia appears happier, not sadder, than its HDI score would predict. This conclusion also holds when we turn to a larger cross-national dataset than the one used by Blanchflower and Oswald, when we analyse life satisfaction in place of happiness, and when we measure development using GDP per capita in place of the HDI. Indeed, in the World Values Survey, only one other country (Iceland) has a significantly higher level of both life satisfaction and happiness than Australia. Our findings accord with numerous cross-national surveys conducted since the 1940s, which have consistently found that Australians report high levels of wellbeing.

Suggested Citation

  • Leigh, Andrew & Wolfers, Justin, 2006. "Happiness and the Human Development Index: Australia Is Not a Paradox," IZA Discussion Papers 1916, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp1916
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    1. David G. Blanchflower & Andrew J. Oswald, 2005. "Happiness and the Human Development Index: The Paradox of Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 38(3), pages 307-318, September.
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    Cited by:

    1. Bruno Frey & Alois Stutzer, 2010. "Happiness and public choice," Public Choice, Springer, vol. 144(3), pages 557-573, September.
    2. Betsey Stevenson & Justin Wolfers, 2008. "Economic Growth and Subjective Well-Being: Reassessing the Easterlin Paradox," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 39(1 (Spring), pages 1-102.
    3. David G. Blanchflower, 2007. "Is Unemployment More Costly Than Inflation?," NBER Working Papers 13505, National Bureau of Economic Research, Inc.
    4. Bruno S. Frey & Alois Stutzer, 2009. "Should National Happiness be Maximized?," Chapters,in: Happiness, Economics and Politics, chapter 14 Edward Elgar Publishing.
    5. Schurer, S. & Yong, J., 2012. "Personality, well-being and the marginal utility of income: What can we learn from random coefficient models?," Health, Econometrics and Data Group (HEDG) Working Papers 12/01, HEDG, c/o Department of Economics, University of York.
    6. Iddisah Sulemana, 2016. "Are Happier People More Willing to Make Income Sacrifices to Protect the Environment?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 127(1), pages 447-467, May.
    7. Angus Deaton, 2010. "Income, Aging, Health and Well-Being around the World: Evidence from the Gallup World Poll," NBER Chapters,in: Research Findings in the Economics of Aging, pages 235-263 National Bureau of Economic Research, Inc.
    8. Daron Acemoglu & Simon Johnson & Pablo Querubin & James A. Robinson, 2008. "When Does Policy Reform Work? The Case of Central Bank Independence," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 39(1 (Spring), pages 351-429.
    9. Claudia Senik & Andrew E. Clark, 2007. "La croissance rend-elle heureux ? La réponse des données subjectives," PSE Working Papers halshs-00588314, HAL.
    10. Christopher K. Hsee & Fei Xu & Ningyu Tang, 2008. "Two Recommendations on the Pursuit of Happiness," The Journal of Legal Studies, University of Chicago Press, vol. 37(S2), pages 115-132, June.
    11. Christopher Ambrey & Christopher Fleming, 2014. "Life Satisfaction in Australia: Evidence from Ten Years of the HILDA Survey," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 115(2), pages 691-714, January.
    12. Angus Deaton, 2008. "Income, Health, and Well-Being around the World: Evidence from the Gallup World Poll," Journal of Economic Perspectives, American Economic Association, vol. 22(2), pages 53-72, Spring.
    13. David G. Blanchflower, 2009. "International Evidence on Well-Being," NBER Chapters,in: Measuring the Subjective Well-Being of Nations: National Accounts of Time Use and Well-Being, pages 155-226 National Bureau of Economic Research, Inc.
    14. Greg Coombs, 2006. "Wellbeing and happiness in OECD countries," Economic Roundup, The Treasury, Australian Government, issue 2, pages 11-21, May.
    15. Yew-Kwang Ng, 2011. "Happiness Is Absolute, Universal, Ultimate, Unidimensional, Cardinally Measurable and Interpersonally Comparable: A Basis for the Environmentally Responsible Happy Nation Index," Monash Economics Working Papers 16-11, Monash University, Department of Economics.
    16. Sharon Kemp, 2011. "Corporate governance and corporate social responsibility: lessons from the land of OZ," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 15(4), pages 539-556, November.
    17. Bruno S. Frey & Alois Stutzer, 2006. "Should We Maximize National Happiness?," IEW - Working Papers 306, Institute for Empirical Research in Economics - University of Zurich.
    18. Chun-Hung Lin & Suchandra Lahiri & Ching-Po Hsu, 2014. "Happiness and Regional Segmentation: Does Space Matter?," Journal of Happiness Studies, Springer, vol. 15(1), pages 57-83, February.

    More about this item

    Keywords

    happiness; life satisfaction; Human Development Index; income; Australia;

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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