Happiness, economic growth, and oil prices
Posted by Stuart Staniford on July 27, 2007 - 10:15am
Topic: Sociology/Psychology
Tags: happiness, peak oil [list all tags]
Furthermore, oil prices are fairly uncorrelated with happiness:
Conclusion: The absolute level of happiness of the US population is not very sensitive to macroeconomic variables. The approach of peak oil has not had a large effect on happiness so far. Interesting to watch how this develops.
Finally, I would say that I am "pretty happy". It would be interesting to know how personal happiness correlates with views on peak oil.
Small Print
This is the happiness raw data:
| 1972-82 | 1982B | 1983-1987 | 1987B | 1988-91 | 1993-1996 | 1998 | 2000 | 2002 | 2004 | 2006 | ||
| Very Happy | 1 | 4632 | 68 | 2352 | 64 | 1918 | 2240 | 891 | 881 | 415 | 419 | 920 |
| Pretty Happ | 2 | 7194 | 209 | 4179 | 216 | 3368 | 4332 | 1575 | 1603 | 784 | 738 | 1676 |
| Not too happ | 3 | 1755 | 73 | 903 | 63 | 571 | 891 | 340 | 293 | 170 | 180 | 390 |
| Don't know | 8 | 1 | 0 | 1 | 0 | 0 | 2 | 2 | 1 | 1 | 2 | 6 |
| No answer | 9 | 44 | 4 | 107 | 10 | 50 | 37 | 24 | 39 | 2 | 1 | 0 |
| Not applicabl | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1393 | 1472 | 1518 | 4383 |
I plotted the center point of the aggregate time ranges, and the percentages in my graph neglect the don't know/not applicable responses. I cannot find an annual series for this survey question, though the survey is apparently performed annually.
Also, Methodological Report 56 cautions:
21. Two separate context effects have distorted the time trend on personal happiness (HAPPY). First, personal happiness is higher for married persons when preceded by an item on marital happiness (HAPMAR). Marital happiness has preceded personal happiness on all surveys except 1972 and Form 3 in 1980 and Form 3 in 1987. To make a consistent series we have a) used the experimental comparisons in 1980 and 1987 to adjust the 1972 personal happiness figures and have eliminated the variant experimental forms in 1980 and 1987 (Smith, 1979). Second, personal happiness is lower when not preceded by the five-item, satisfaction scale (SATCITY, SATHOBBY, SATFAM, SATFRND, SATHEALT). This scale has routinely preceded personal happiness except in 1972, in 1985, on Form 2 in 1986, and on Forms 2 and 3 in 1987. Using the experimental comparisons in 1986 and 1987, we have adjusted the figures for 1972 and 1985 and have eliminated the variant forms for 1986 and 1987 (Smith, 1986).
Great googly-moogly. TOD server is choking today. I don't know what's wrong, but something is.
There was an interesting study I posted a link to awhile back. It was about Mexican immigrants. They come to the U.S., and become significantly wealthier...but much less happy. Apparently, Mexicans tend to be much happier than USans. As Mexicans assimilate into US culture, they become more similar to us. Psychologically was well as economically.
The happiest people in the world are Nigerians. Money really doesn't buy happiness.
Not that I expect that to turn people away from money. Heck, I know something like 3 out of 5 lottery winners end up bankrupt in five years, and many wish they'd never won. Some even give the money back. But I still want a chance to test it for myself! ;-)
FWIW, I also would say I am a pretty happy person. Even though many here consider me a doomer. ;-) I'm a technophile, but I know, from personal experience, that technology is not necessary for happiness. I've lived overseas without electricity or running water. Is it less convenient? Hell, yeah. But it really has nothing to do with happiness. You get used to it very quickly.
Leanan,
"The happiest people in the world are Nigerians". What's your source on that? This source
http://www.le.ac.uk/pc/aw57/world/sample.html
shows global happiness levels being ROUGHLY in accordance with GDP (ie monotonic wrt GDP on a country-by-country basis). As far as I know the 'positive psychology' interpretation of this goes 'Below $15,000 money buys happiness, above $15,000 people get confused and start judging themselves relative to their neighbours, hence no measurable increase in (mean) happiness once (mean) income gets near (+/-) $15,000.
This fits with what you say about Mexicans - Mexicans in Mexico = happy, because they earn about $10,000 (GDP/capita basis). Mexicans who move to the US = happier because they earn more (clearly, otherwise they wouldn't move). Mexicans who stay in the US longterm = unhappy since they start judging themselves relative to the US average of $44,000.
I highly recommend the books 'Authentic Happiness' by Martin Seligman, 'The Happiness Hypothesis' by Jonathan Haidt and 'Stumbling on Happiness' by Daniel Gilbert. If you're interested in this stuff then you'll really enjoy each of them.
Cuchulainn
Nigeria tops happiness survey
I'm a little suspicious that the master might be telling us how happy the house slaves are. Maybe, maybe not. I'd rather a Nigerian source.
cfm in Gray, ME
I'd also recommend Luxury Fever: Money and Happiness in an Era of Excess, Robert Frank. Excellent in depth discussion of these issues.
http://www.amazon.com/Luxury-Fever-Robert-H-Frank/dp/0691070113/ref=pd_b...
The happiest people in the world are Nigerians
A while ago I read that the scandinavians, especially the danish people, are the, hm, happiest? No I think they called it 'most contented' (I hope that's the difference between German 'gluecklich' and 'zufrieden').
Contentedness as per that report was rooting in high social standards, and, interesting enough, absence of religious pressure.
I remember that study. I believe it was contentment, not happiness. Basically, it was because Danish people have low expectations. So they're always pleasantly surprised.
It pays to be a doomer! ;-)
Danes are known for their brutal honesty. So they don't suffer from the continual struggle to make nice.
Hi radlafari,
I think the word you're looking for is schadenfreude. ;-)
Happiness is a collie.
http://www.collierescuenetwork.com/
Casey, Kyle, Kingston and Kelsey extend their paws.
Cheers,
Paul
Interesting observation Stuart, and puts "happiness" in its rightful place.
However, I remember being quite happy during the 70s oil embargo, and happy-but-becoming-anxious during the early 80s embargo (and concurrent hyperinflation). I think a different analysis that might be equally useful would have to do with anxiety or crime when economic times get difficult.
Remember the hijacked meat trucks during the embargo when meat prices soared? How about the warning not to use locking gasoline caps on your car since it would tempt people to break them open -- in spite-- so they could steal YOUR gasoline. Maybe the locking gas cap rumor was because I was living in Lowell MA during the first oil embargo and Lowell was at times a rough place. However, that environment might be a good paradigm of what might happen if the economy really goes bump as peak oil settles in.
Comments?
Green Hornet
http://livingwithoutoil.blogspot.com
http://my-words.org/Beyond2010-top/top.htm
I recommend the book "The Paradox of Choice" by Schwartz; it's a quick read and highlights some non-intuitive realities about the "Tyranny of Choice".
Basically, being overwhelmed with choices messes people up. Is there anywhere Tainter isn't hiding?
I second this recommendation.
I think there is also a social element to be considered when asking people how happy they are. Maybe in Nigerian culture it's considered normal to say you are happy, but in some western countries maybe it's considered better form to downplay how happy you are for some reason.
It's a tough thing to measure accuately.
Wrong.
Happines peaked just as per annum increases in per-capita energy consumption peaked here in the U.S.:
http://www.lifeaftertheoilcrash.net/OriginalArticles/EnergyHappiness.htm...
Please note: it's the amount of increase, not the total amount that appears to be operative here.
As far as my happiness, I'm an uber-doomer and I'd rank my level of happiness as a "7.5" on a scale of 1-to-10.
And the Lawyer proclaims definite links between money and happiness.
Some of my happiest times were college and the military when I was flat broke.
I'm an uber-doomer also, Matt. And although I'm laid-off at the moment from my primary job, I'm doing well enough with my home-based job. When I'm employed at my primary job, my happiness level would be around an 8. I'm probably around 6.5 right now because of the strain on my budget at a time that I feel desperate about the lack of funds for preparations, which I am woefully behind on.
Having said that, I suspect that when TSHTF and if I make it through the ensuing chaos, I believe I'll be capable of leading my family through it and on the other side. If all goes well, I believe that I will actually be at a higher level of happiness post-SHTF...maybe even a 9 - 9.5.
I have never been a fan of our servile social evolution. I'm...disenchanted...with it. It's time to start over!
dude (or dudette, as the case mya be) . . . anybody who can come up with the screen name "Ovis Suburbanus" (Suburban Sheep) has enough of a sense of humor about things that I'm sure they'll be able to get to 9.
That would be Mr. Suburbanus :). And you have to keep your sense of humor despite having the foresight of things to come. I expect difficulties and hardships, but oh will it make life just a bit more interesting. I'm glad I'm around at a time will humanity will see it's single most profound change in all of human history. So, cheers to having a front-row seat!
"If you can't laugh about the end of civilization what can you laugh about?"
I'm still a little miffed you didn't approve my myspace friend request, though :P
#1 I don't use myspace much
#2 I don't even know you
Interesting. I believe myself to be in the same boat with you. I truly believe that once we make it through the turmoil and I am living as a subsistence farmer, that I will be happier than I have ever been, hardships and all. I believe I might even be considered an anarchist in some ways.
If you're not truly an anarchist now, events may dictate that you will be. I see you just joined The Oil Drum and I'd like to welcome you. Are you new to PO awareness?
I recall when movies were preceded by a news reel where a man speaking in a stylized and serious voice would read off some news and bring us up to date on all the wonderful things science was doing that laid the ground work for a wonderful space age life. Boy! Life was exciting with so much to look forward to.
I have a mental picture of the availability of “things” to purchase and make our lives easier and more interesting as being sort of a bell curve that tracks the availability of cheap energy. Of course, we don't know what the “other” side of the curve will be like when energy is no longer cheap and plentiful but we can sort of get and idea by re-learning what life was like in the 1950's, 40's, 30's and so on. What will it be like when things we are accustomed to having any time we want are slowly (or maybe not so slowly) peeled away. Most novels and science fiction somehow embodies the notion that the human spirit triumphs over adversity. My recollection is that that was always at the root of all Star Trek episodes.
But we moderately well-to-do folks living in the developed world probably have a hard time imagining a world where new things are not being developed, economic growth does not continue, and we'll finish out our career and move into a wonderful retirement. We probably can intellectually but at the emotional level we probably think we'll pull through somehow. I wonder how folks will bear up psychologically if or when we come to grips with the reality that we have reached the tipping point of all the good things life has to offer and have begun sort of living life in reverse as we slide down the other side of the bell curve.
The data I've been able to find so far are not very different from flat over time, hence my comment. There's some sign that things were a bit worse in the 1980s, but then got better again in the 1990s. Do you have any data back into the 50s or 60s? (your linked article relies on a single quote from a newspaper article).
Money may not buy happiness, but it will sure rent it for awhile.
I had a friend who won a $20k scratch-off and it ruined his life. He took the money and spent it gambling at a Louisiana casino, didn't give any to his wife. Disgusted with him after 20 years of marriage while he held only irregular jobs, she divorced Gary. Gary took to living in a taxicab and driving, got cancer and died a couple of years ago homeless and destitute. But he sure was happy for a week until the money was gone.Bob Ebersole
Influx of money + responsible person = good chance of more happiness
Influx of money + the typical American jackass = good chance of a massive clusterfuck
In all fairness, I can assure you, as a European, that you can drop the "American" there - jackassness is a universal constant.
That said, there are pretty good chances that jackasses will peak not too long after oil.
I have a brother that also has a problem remaining employed.
He thinks that every time he gets fired its the employers fault. And on many issues he is never the one that made a mistake. Its people like him that I hope will wake up to the reality of life as it gets harder for everyone. The key problem is people simply are not grateful or thankful. Almost nobody in the US spends any amount of time reflecting on what they have instead the focus on what they want. To me this lack of gratefulness is the real underlying problem for a lot of Americans and people throughout the world. We have lost this.
I think my parents who are baby boomer's are grateful but I think that its their generation that started to lose any concept of respecting success. Because being grateful is really about respect for those who have less than you and being thankful for what you have.
Sorry for the rant but the disgusting greed of Orange County CA grates on my nerves from time to time. Its a pretty sick and shallow place. If this is peek greed then I don't feel sorry its ending so we can get back to living and enjoying life.
memmel.....
You have expressed exactly how I feel. The spoiled rotten mentality of most people in this country is appalling. It makes me sick. Glad I'm not the only one who feels this way. The effects of peak oil will cause these spoiled brats to go off a temper tantrum like has never been seen.
On this we agree although I'm a boomer.
I think "I am supposed to be happy"
Replaced
"I am supposed to care for my family"
"I am supposed to be considerate of others"
"I am supposed to keep my word"
"I am supposed to take care of myself and be responsible for my choices and outcomes rather than rely on or blame others for my circumstances"
And we could certainly come up with others..
Thank you of course being the child of a boomer and well in to the spoiled generation we are not taught these concepts in school. It might ruin our self image I guess.
I was but thats just because of how may parents thought.
Not to rag the boomer generation but I just feel that its the one that fragmented with part of it looking back to the past and the wars and depression and part of it partying like no tomorrow. And it crosses all the various lifestyles from the hippies to the right wing republicans. You nailed it. The key is being responsible and thats tied with being grateful and simply being able to be responsible and finally you get to happiness or satisfaction. And this in turn goes all the way back to understanding the difference between what you deserve and what you have. People deserve very little in a wealthy society food, minimal shelter and some basic health care and the responsibility of caring for dependents.
Other than that ...
Sometimes the lack of money brings even more happiness. Thru a lot of hard work last year, I was able to keep my income so low I paid nothing in taxes. For one year, the war wasn't mine. That made me happier than any amount of money would have.
Rat
This is a plot of the US Personal Saving Rate (which appears to basically be a cash flow metric) versus Brent crude oil prices. It's normalized. In both cases the 2000 value = 100.
http://www.theoildrum.com/files/PSR_Brent.png
Before putting too much into this, it would be useful to look at the same time series over a longer period. Personal savings in the US as a percent of disposable income has been decreasing on a linear trend since about 1982 (eg, Chart 1 in this Federal Reserve research paper, whereas crude prices have not shown the post-2003 trend over that longer period. This would seem to suggest that the cause for the decrease in savings rate is not due to energy prices, but rather to something different.
At least one of the hypotheses that has been put forward to explain the savings trend has been the much more sophisticated credit market that has emerged over that period, and errors in the way that measurements are made. Historically, it was necessary to save first, then purchase large consumer goods. Today, so many people can get credit (or even, have credit thrust upon them) that one can buy first, then save. Add in complications such as money contributed to a 401(k) account does not count towards the savings rate in the current methods of calculation, and it becomes very difficult to make comparisons.
Some economists have gone so far as to suggest that the very high savings rates in Asia are more a reflection of immature credit markets than anything else; in the US, you buy the new refrigerator on credit and then "save" to pay for it; in China, OTOH, you still have to save first and then you can buy the refrigerator.
Another hypothesis, fwiw, is that the US tax-deductibility of mortgage payments is a significant cause of the low US savings rate - people are encouraged to spend money on (mortgage) interest payments, since the government takes this out of pre-tax, rather than post-tax income.
Cuchulainn
I could be wrong, but I think that this is the first time since the Thirties that the Personal Saving Rate (PSR) has been negative.
Note that Saving is singular, not plural. As I understand it, the PSR is basically a cash flow metric, i.e., how much cash is left over after paying bills.
Of course, the oil price increase has also corresponded to the gigantic increase in total US public and private debt. So, for many American consumers, their finances are based on perfection, i.e., among other things based on the assumption that we can have an infinite rate of increase in the consumption of a finite energy resource base.
_Bill Gross, Pimco, Investment Outlook for July 2007
People don't have the cash to save very much, the inflation rate is total BS, it excludes food and energy, the daily necessities. Wages have sunk for many families as manufacturing jobs are replaced with service and retail, and most construction trades are Mexicans.
Many families in the US are walking a tight-rope. They've borrowed to the hilt with a second mortgage to pay off their credit cards and bought an SUV for every adult in the family to get to work, plus the rebate to juggle the bills another couple of months. Their credit cards are at 18%-22%, and if any disaster hits its the bankruptcy court. Nobody can get sick, or have a large auto repair, or get laid off.
I'm not very sure that a personal evaluation of happiness on subjective criteria is valid, ther are just too many different groups in the US, and a lot of deceit. Bob Ebersole
A number of studies that I have read indicate that your happiness is not driven by your gross income in nominal dollars, it is driven by your relative standing among your peers and community.
For example, if you are the "richest of the poor" (your relative standing among your peers/social circle is higher than others), you tend to be more happy; even though in the big picture, your still poor.
Or, if you are the "poorest rich person, in a rich community", your happiness will be less because you are always comparing yourself relative to your peers/social circle; even though in this case amoung the total population, your still rich.
Likewise, if some event (e.g. peak oil) causes everyone's living standards to be reduced by X amount with all things else being held equal, then one's relative standing among thier peers/social circle will remain the same and we would expect that their happiness would remain basically the same. Kind of the effect "everyone is in the same boat".
If someone had the time and data, they should look at happiness during the great depression. I would guess that happiness was relatively the same because among one's peer group and social circle, everyone was dealing with the same difficulties.
See my other post. Your missing the concept of gratefulness.
I suspect people in the Great Depression where full of gratefulness if they had a job. Its a different concept from happiness but in my opinion far more important. I suspect that the Happiness measure that puts Nigeria on top is really a result of the fact that Nigerians are grateful for their success no matter how meager.