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Can happiness be measured?

04 April 2013

Mr Menon giving his personal views on happiness at the recent U@live forum
What is happiness? The elusive concept that many people have been pursuing since time immemorial defies clear definition. Mr Ravi Menon, NUS Social Science alumnus and Managing Director of the Monetary Authority of Singapore, gave his personal take on the intriguing subject at the recent U@live forum organised by the Office of Alumni Relations.

Mr Menon discussed four key points - how happiness is measured (its correlates), whether it is absolute or relative, whether public policy plays any role in advancing happiness, and the things that make him happy.

Speaking to a capacity crowd, Mr Menon shared some of the major factors that drive happiness. According to studies, higher incomes, good health, being married and having a religious faith are all correlates that lead to greater happiness. Of these, the relationship between income and happiness holds the most fascination. He noted that a lot of work has gone into researching the question "Does income generate happiness?"

Richer countries have generally higher levels of surveyed happiness than poorer countries. However, the association is not so clear cut and striking anomalies exist across countries. For instance, Nigeria, where poverty is widespread, possesses a higher level of happiness than Germany, one of the richest nations in the world. The same is observed in Indonesia when compared to wealthier Singapore. The correlation between income and happiness is thus not a strong one.

Time is another parameter with weak correlation to the happiness index. Surveys conducted in the US show that even as income in the country has grown over time, happiness levels have not. "There is a notion of satiation that beyond a certain point of income, additional increments to income do not create more happiness... other factors come into play," Mr Menon pointed out. Which leads to the second question of "Is happiness relative or absolute?"

People become happier when their incomes go up, but if everyone else's income also rises, the happiness level does not increase. "So happiness is largely defined in terms of relative wealth and relative income," Mr Menon observed. The relative basis for deriving satisfaction applies to other things - when a person is unemployed, his happiness level drops; however, he may not feel worse if the unemployment rate in his community is high. Social benchmarks thus contribute to determining happiness.

Public policies and governments have a role in advancing happiness. Although the Gross Domestic Product (GDP) of a country has served Singapore well and allows welfare for the needy, Mr Menon admitted that looking at GDP no longer suffices - environmental factors that support a sense of well-being are increasingly critical.

Friends, family, country and God are four key sources of happiness for Mr Menon. He added that addressing basic materials needs first is important because if these are not met, deriving happiness from other areas will be difficult. Also, he believed that the quality of relationships one builds can be exceptionally satisfying.

Participants at the forum actively joined in the discussion by giving their views of happiness and posing thought-provoking questions.

U@live is a monthly forum that showcases illustrious NUS alumni who have been indefatigable in championing causes to make this a better world.

By the Office of Alumni Relations