Is the economic crisis still making Americans unhappy?

by on September 28, 2011 at 10:23 am in Uncategorized | Permalink

In a new paper, Angus Deaton says maybe not so much (pdf).  Happiness surveys show a big negative effect from the downturn in 2008, but most of it has since evaporated.  You can conclude that a) things really are better, b) they are not focusing enough on the long-term unemployed, c) I shouldn’t trust happiness surveys, d) this explains why we are still headed off a cliff, or some combination of the above.  For the pointer I thank Eric Barker.

Chris September 28, 2011 at 10:26 am

or e) happiness is relative and always compare current state with the recent past.

I guess that could also be rolled into c)

Right Wing-nut September 28, 2011 at 10:37 am

+1

Brad September 28, 2011 at 10:41 am

Exactly. Straightforward Kahneman.

Benny Lava September 28, 2011 at 10:48 am

This exactly.

rjs September 28, 2011 at 3:01 pm

tangential to that, emotion is influenced by one’s neurochemical & hormone balance, which stabilizes an individual’s feelings over time…

Turkey Vulture September 28, 2011 at 5:19 pm

Exactly.

Thought+Food September 28, 2011 at 10:28 am

When the shock first occurred, people went down a spiral of misery. Today grim is the new normal.

prior_approval September 28, 2011 at 10:34 am

e) it has become so much easier to ignore the unhappy in the U.S.

Right Wing-nut September 28, 2011 at 10:39 am

What? So you’re claiming that people who are surveying happiness are deliberately excluding the unhappy from their survey? They do that ex-post?

prior_approval September 28, 2011 at 12:07 pm

Nope – I’m claiming that a number of unhappy people are simply no longer being measured. Possibly, because this state causes them to more or less ‘disappear.’

I’m not being cryptic, either. I’m currently listening to WFMU – they have no ads, no sponsors, and are devoted to freeform as a music format. No one measures their broadcast ratings, I’m quite certain – this based on the reasonable belief that WFMU doesn’t pay anyone for ratings.

Surveys of happiness are not simply created out of some dispassionate interest in an abstract concept – they are a marketing tool. But when the people being interviewed are no longer of any interest to those buying the results (or potentially buying after becoming aware of such results due to PR), there is no reason to spend the money to interview them.

And again, I’m not being cryptic – almost 30 years ago, for the only time I was ever surveyed personally about my listening habits in the U.S.’s most varied FM broadcast market (DC’s, due to the lack of tall buildings and generally flat topography), Arbitron asked me about my listening habits – and as then freeform (Bethesda) WHFS hadn’t paid to be rated, my response to the listening survey were simply irrelevant – WHFS not being on the list meant that my response was utterly meaningless in terms of being recorded. In other words, Arbitron wasn’t measuring, in any sense, how many people were ‘unhappy’ with all the other radio stations – they were only measuring those who were content to listen to the stations that were paying for the survey.

No one making surveys is especially interested in making any serious effort to discover what the broke and foreclosed and discouraged and unemployed think – they simply aren’t a market that anyone thinks worth paying to find out about. And that remains true whether they are growing or shrinking as a group – they are of no interest.

In other words, as the tools for screening respondents have grown better, the ability to filter those whose answers are of no interest to those funding the results has also grown.

Laserlight September 28, 2011 at 12:17 pm

Three interviewees were competing for one job. The question was, “What is 2+2?”
The mathematician answered “Four.”
The accountant answered “Four, not counting interest, taxes, depreciation, et cetera.”
The marketing person answered “What do you want it to be?”

Claudia Sahm September 28, 2011 at 11:22 pm

Marketers are not the only people doing surveys. Institutions like the Survey Research Center at University of Michigan or NORC at the University of Chicago and a whole host of government agencies run surveys that are designed to be representative of the larger population. True, deeply unhappy people…especially ones who have lost their ties to their community…are tougher to find, but attempts are made. Not all surveys are created equal. I would do almost any survey for a reputable survey group and I would hang up instantly on any marketing survey. Wasting my time makes me unhappy.

prior_approval September 29, 2011 at 7:34 am

Where does the Survey Research Center at University of Michigan gets its funding/orientation? Ah, here is the general overview – ‘The University of Michigan Institute for Social Research (ISR) is the world’s largest academic social science survey and research organization. We are a leader in developing and applying new social science methods, and we are committed to educating the next generation of social scientists. After a rich 60-year history, we continue to broaden our scientific reach through international ventures and new collaboration with federal agencies, foundations, corporations, and private individuals.’ Having worked at a university (including writing such PR copy) for more than a decade, that last sentence is pretty clear about their interest in funding.

As for politics – yes, that was a part I left off, as the pursuit of power and money are definitely not the same thing, at least in the American system

‘I would do almost any survey for a reputable survey group and I would hang up instantly on any marketing survey.’
Notice that list for the University of Michigan Institute for Social Research is reputable, but also presents a list of organizations they are willing to work with (or less subtly, the ISR will accept money from) represents a list of reliable funding sources – and those sources are only interested in power or money, in the end.

This is not to impugn the work, actually – it is merely to point out that happiness of major portions of the American population (immigrants from Central America over the last 30 years, for example, who represent a significant number of people living in the DC metro region, as a concrete example), are of minimal to no interest in such surveys. Much the same way that this group of likely 100,000-200,000 people (the fact that no reliable number exists already says something about such surveys) in a region of several million is easily ignored – unless you are interested in local soccer clubs, or know which stores and restuarants exist to serve this market (hint – they aren’t paying to advertise in the Washington Post).

Claudia September 29, 2011 at 3:19 pm

Prior_approval: Here’s a link for you…http://voices.washingtonpost.com/federal-eye/2010/06/baltimore_census_worker_killed.html Census worked killed going in to neighborhoods with low response rates. Happily I have a job where I am not physically in harms way. I respect people who put their life on the line for the greater good. And yes money comes from somewhere (no magic trees or helicopter drops). Of course any organization….even this blog has a power structure that’s life.

FYI September 28, 2011 at 10:47 am

Or, maybe Americans are so rich (in the absolute sense) that they can just get by even when the economy is hurting.

This is actually just a reflection of something that is pretty obvious to me: our complete inability in measuring our wealth. I have 2 close friends who are currently unemployed. One has saved some money and went back to school now to get his MBA. He has no income. He got unemployment insurance for a long period, got government help (!) to go back to school, stimulus checks over the mail and I think he could get food stamps if he wanted to. He owns his house, canceled the cable and his car lease. According to his calculation he can stay in this mode for 3/4 years without working at all. He is officially ‘looking for a job’ but with no urgency. For all statistics he is now a miserable, desperate poor person who would die if we didn’t help. The other friend is now living with his sister. She used to work but just got divorced and moved to a new city. She is living out of alimony. Again, no income. Her kids (college age) who initially didn’t get any government money for college (since her husband makes decent money) have applied again and voila, government help is on the way. Again, for all statistics she is a poor person but she is living a very, very comfortable life. Both of them are not unhappy at all – if anything, they are happier.

Right Wing-nut September 28, 2011 at 12:30 pm

There is a strong positive statistical link between “poverty” in this country and obesity. What a country!

FYI September 28, 2011 at 12:41 pm

Yeah… And somehow there are plenty of ‘studies’ that show that we have millions of ‘hungry’ people. I guess we got to keep the government machine running somehow.

msgkings September 28, 2011 at 1:01 pm

You two (FYI and RW-N) are to be commended for cracking the conspiracy. Now we know that there aren’t poor people, and everyone is doing well.

FYI September 28, 2011 at 1:16 pm

That is not it. There are poor people that actually need help but I suspect thei numbers are a lot smaller than what the statistics show.

Benny Lava September 28, 2011 at 12:45 pm

Doesn’t that tell you more about the quality of food that the poor eat than quantity?

FYI September 28, 2011 at 1:14 pm

Kind of. There are plenty of rich people who are fat. Poor people have less access to other factors that impact obesity: exercise, nutritional information, etc. so the overall rate of obesity for the poor is worse.

However, the point here is that there is a huge difference between eating an unbalanced diet and being hungry. By definition, if you are fat you are *not* hungry (not in the sense the liberals want that to mean anyway).

Tom September 28, 2011 at 4:06 pm

Right. It’s less expensive to get full on fat than protein or carbs.

For example:

http://www.mymoneyblog.com/what-does-200-calories-cost-the-economics-of-obesity.html

TheophileEscargot September 28, 2011 at 10:48 am

Sounds like Hedonic Adapation. Whether you win the lottery or lose a limb, your happiness tends to return to its original level after a while.

http://en.wikipedia.org/wiki/Hedonic_adaptation

Mike September 28, 2011 at 10:53 am

So the nation is now in Stage 5 of the Kübler-Ross Model.

I’m glad we’re past depression.

Jim September 28, 2011 at 11:03 am

How about:

f) If you have a fake job at Princeton, you have an extreme interest in seeing Obama re-elected, so putting out papers saying the life in 2011 is wonderful is a probably a good career move.

Wonks Anonymous September 28, 2011 at 11:16 am

I guess Karl Smith should conclude we do not, by definition, have a bad economy.

Sophie September 28, 2011 at 11:27 am

f) They interviewed mainly bankers, who had their best ever year last year. (Well the one I’m married to did, anyway)

Sophie September 28, 2011 at 11:28 am

oh sorry, that should have been g)

Finch September 28, 2011 at 11:47 am

The people who are long-term unemployed are not the people who are very unhappy when they are unemployed.

Matt September 28, 2011 at 12:35 pm

I’d go with “c” until they can invent a brain scan you can wear around all day like a hat. It does kind of make me wonder if happiness researchers have ever studied the effect of the ratio of news consumption to other t.v. programs on happiness.

Daniel Klein September 28, 2011 at 1:02 pm

I agree that “happiness” gets rebenchmarked, as it were.

But also there is: Smith, TMS, 148ff on the guy who loses his leg etc:

“The never–failing certainty with which all men, sooner or later, accommodate themselves to whatever becomes their permanent situation, may, perhaps, induce us to think that the Stoics were, at least, thus far very nearly in the right; that, between one permanent situation and another, there was, with regard to real happiness, no essential difference: or that, if there were any difference, it was no more than just sufficient to render some of them the objects of simple choice or preference; but not of any earnest or anxious desire: and others, of simple rejection, as being fit to be set aside or avoided; but not of any earnest or anxious aversion.” (TMS, 149)

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