The Optimist

Don't Worry About Being Happy

Hey, world leaders: Knowing how good your citizens feel about themselves won't help you run your country.

If you want to understand how far the craze for measuring happiness has spread, look no further than that venerable U.S. institution, the Girl Scouts. Last week they rolled out a new badge for excellence in understanding "the science of happiness." And that should help the aspiring statisticians in their ranks, at least -- politicians have taken to happiness polls like kids after another package of Thin Mints. French President Nicolas Sarkozy recently suggested adjusting traditional economic indicators with a measure for happiness. Charles Seaford of Britain's New Economics Foundation notes that government officials in Australia, Britain, China, Ecuador, Germany, Italy, Spain, and the United States are joining France in moving toward tracking measures of the subjective quality of life. In Britain, the Office for National Statistics' Integrated Household Survey now asks how satisfied people are with their lives; Labour Party advisor Richard Layard has called for subjective well-being polls to replace GDP altogether as the measure of a country's progress.

Happiness polls certainly measure something that matters -- and results regarding "what makes you happy" are consistent across countries. Those who say they are happy smile more than average; they sleep better and are seen as happier by friends, family, and psychologists. People who say they are happier go on to live longer, healthier lives. Not least, the polls suggest the value to happiness of short commutes and long holidays -- two things we can all get behind. But wonderful though it may be to imagine calculating the costs and benefits of government action in giga-smiles per minute, there are real problems with using measures of happiness as the basis for policymaking.

Consider the much discussed link between happiness and income. We know with a fair degree of certainty that recessions make people unhappy, unemployment makes them even more so, and unusually rapid growth can lead to a temporary boost in reported well-being in a country. But while more money makes people happier in the short term, they may not stay that way: The link between long-term income growth and happiness is hotly debated. A 2002 study by economists Ada Ferrer-i-Carbonell and Paul Frijters looked at changes in the happiness of Germans over time, asking subjects about both income changes and how satisfied with life they were on a scale of zero to 10. The results suggested that it would take an 800,000 percent increase in income to raise the average German's reported satisfaction by one point on that 10-point scale. (In fact, happy people earn more as a result of their good humor -- who would you rather hire: Eeyore or Tigger? So governments might want to encourage happiness to improve economic performance, rather than the other way around.)

One conclusion from that evidence could be to say long-term GDP growth really doesn't matter and we should be focusing our attention elsewhere. But it is also worth asking why so few people go around asking for a pay cut from their employers or refusing to accept their lottery winnings. Perhaps we care about other things in life than improving our answer to a pollster about how happy we are. We might value the prestige or the experiences money can bring -- even if those things don't make us declare we are ecstatic in a poll. The same applies to children: Analysis of the relationship between kids and life satisfaction suggests that people with kids are less happy than those without kids -- but that doesn't mean kids aren't important to their parents.

In fact, over the short term, happiness poll averages vary as a result of all sorts of daily hassles and small pleasures rather than anything we really want policymakers to focus on. Princeton University economist Angus Deaton has looked at daily tracking polls of subjective well-being in the United States during the financial crisis and suggests that, while they did track the performance of the U.S. stock market, scores were nevertheless "affected more by the arrival of St Valentine's day than … a doubling of unemployment." He concludes, "In a world of bread and circuses," monitoring changes in happiness polls "picks up the circuses but miss the bread."

Adding to the difficulties of using happiness to guide policy is the fact that it has more to do with humans' inherently social nature than with the kind of absolutes that government policies can easily affect. Happiness researcher Carol Graham at the Brookings Institution reports that unemployment matters to happiness scores in general but matters less so when many others are unemployed. And being thin makes you happy in the United States and sad in Russia. Being absolutely rich matters a little, but what really matters is being richer than your peers and neighbors. These kinds of complex and context-dependent relationships are tough to manipulate from Washington.

In fact, the nature of happiness can actually be a barrier to sensible policies. Over the long term, individual happiness reports just don't change very much -- people have a "set point of happiness" they return close to even after disability or bereavement, for example. And Graham notes that people's immense ability to be happy even in grim circumstances means that they end up tolerating conditions that they shouldn't -- high death rates from easily preventable disease or kleptocratic rulers, for instance. How else to explain Nigeria ranking above Germany in average happiness or Colombia above Canada and the United States? Is the policy conclusion that Nigeria is doing better on what really counts than Germany?

This isn't to say that politicians shouldn't care whether their people are happy. But life is complicated and so is what makes up a good one. It is time to give up looking for a single indicator to capture how we're doing at it. And if leaders still really want to help raise national reported well-being, Deaton's results do suggest one approach. He reports that just thinking about politics makes Americans absolutely miserable -- far more down in the mouth than the entire impact of the financial crisis. The implication: Maybe politicians should talk a little less -- about happiness and about everything else, too.

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The Optimist

Doctors Without Borders

Letting medical professionals and other skilled workers from the developing world emigrate is a good deal for everyone.

Immigration may be deeply unpopular with electorates throughout the developed world, but that hasn't deterred immigrants themselves: The foreign-born share of the population of high-income countries doubled between 1985 and 2005, to nearly 9 percent. And the percentage who were college graduates increased fourfold between 1975 and 2000. That's great news for the rich countries that benefit from their skills, of course. But as it turns out, it is also great news for the poor countries the migrants leave behind.

It is hard to find a more confused discussion than that surrounding brain drain. Opposition to unskilled migration is usually based on perceived self-interest, the threat of stolen jobs -- a misguided fear, but at least a rational one. But certain well-meaning Westerners call for immigration restrictions on educated workers from the developing world for the opposite reason: If you let them leave, they'll abandon their home countries to poverty and deprivation. In 2008, the respected medical journal The Lancet carried an editorial on the medical brain drain of doctors and nurses from low- to high-income economies, complaining that "richer countries can no longer be allowed to exp[l]oit and plunder the future of resource-poor nations"; the same issue carried an op-ed calling for those who recruited African workers abroad to be sent to the International Criminal Court. (Never mind that the ability to leave the country of one's citizenship is considered a human right by the United Nations.) As a result of such thinking, Britain's National Health Service has a code of practice that bans recruitment from 150 developing countries, and there have been calls for something similar in the United States.

Certainly, most skilled migrants make more money abroad than they would at home. John Gibson at the University of Waikato and David McKenzie of the World Bank document salary increases ranging from $40,000 to $60,000 a year for skilled emigrants from developing countries across a range of professions. But the money these workers make abroad doesn't stay there: The average Africa-trained member of the American Medical Association sends home $6,000 a year in remittances, often for two decades or longer. Indeed, remittances from immigrants are an incredibly powerful force for development in any number of African countries -- more than the amount of foreign aid to Ivory Coast, triple that given to Togo, quadruple that to Nigeria, and nearly six times the aid to Mauritius. And the money is put to good use. One estimate from the U.N. Conference on Trade and Development suggests if you doubled remittances to a developing country, you could reduce poverty by nearly a third.

Perhaps more importantly, countries that swap people also swap goods, ideas, and investment. Doubling the number of people who have migrated between two countries raises trade between those countries by 10 percent. And if the number of skilled immigrants doubles in a recipient country, subsequent foreign direct investment to their countries of origin climbs 25 percent. William Kerr, an economist at Harvard Business School's Entrepreneurial Management Unit, even finds that migrants transfer back knowledge about increasing manufacturing efficiency -- so productivity increases in the home country as a result. Economists Hillel Rapoport at Bar-Ilan University and Frédéric Docquier at the Catholic University at Louvain report that about half of the Indian diaspora in Silicon Valley, which ran nearly one in 10 start-ups in the late 1990s, traveled back to India on business at least once a year. They were central to the creation of India's booming IT industry, which now employs around 2.5 million people. Another idea that appears to travel along with migration is democracy -- an International Monetary Fund study found that the more students a country sent for schooling in democratic countries, the more likely the home country was to become or remain a democracy.

But what about high-skilled migrants starving their home economies of vital human capital needed for development? Actually, Rapoport and Docquier conclude that the more high-skilled people leave low-income countries, the higher educational enrollments there climb. The opportunities presented by moving abroad spur people to stay in school and learn more. Surveying the brightest students in Tonga and Papua New Guinea, Gibson and McKenzie find that nearly all of them contemplated migration, and it led them to take on additional classes.

Similarly, Michael Clemens at the Center for Global Development finds no evidence that medical brain drain from developing countries leads to shortages of medical staff back home, probably because the opportunity to migrate is one of the things that attracts people to medical school in the first place. For years, nurses have left the Philippines in huge numbers to work abroad, but the country still has more nurses per person than Britain.

And finally, of course, lots of migrants return with valuable skills and contacts -- including many of those now working in the Indian IT industry. Economists William Easterly of New York University and Ariell Reshef of the University of Virginia carried out an informal survey of the entrepreneurs behind African global export successes and suggested that one factor many had in common was experience living abroad -- usually in the country they subsequently exported to.

All of this suggests those well-meaning folk in rich countries keen to put a travel ban on anyone from a developing country with a degree might want to reconsider their position. But it also contains a lesson for American economic policy. The United States benefits immensely from its talent imports -- immigrants account for over 60 percent of Ph. D. software engineers and more than half of its medical scientists, suggest McKenzie and Gibson. The country should do all that it can to ensure that inflow continues. And it could also do considerably better when it comes to talent exports. The most recent data suggest the United States had less than a third the number of high-skilled emigrants that Britain had -- despite having a population five times larger -- and half the number of Germany. If having a large high-skilled emigrant base in other countries is a powerful source of trade and investment links, the United States ought to be finding ways to encourage more of its best and brightest to spend some time elsewhere.

But in fact, the United States is heading in the opposite direction, on both sides of the trading equation. International applications to U.S. graduate schools only last year returned to their levels in the 2002-2003 academic year after a post-9/11 slump, a function of the stagnant economy and toughened immigration procedures. And at the other end of the degree process, there is growing concern about a "reverse brain drain," as more foreign graduates from U.S. schools decide to return home rather than find jobs in America -- again, often on account of byzantine immigration rules. Meanwhile, the U.S. House Appropriations Committee has proposed deep cuts to State Department international exchange program budgets that support the Fulbright program, among others. This shortsightedness regarding a program that promotes the talent trade in both directions isn't just bad news for the development prospects in Africa or Asia; it's likely to convert into a further erosion of America's long-term productivity.