When collecting data about individual happiness, well being and quality of life come into light; Nobel laureates such as Joseph Stiglitz and Amartya Sen have emphasized this as an effective means to determine the quality of life
Dr. Minhaj Mahmud teaches development economics at BIGD, BRAC University. He is also a visiting scholar for the Japanese International Cooperation Agency (JICA) Research Institute and a member of the Economics Research Group Dhaka. Mahmud’s research has been published in a number of ranked economics journals including Economica, Economics Lettersand Journal of Economic Behavior and Organization.
You have mentioned 6 domains of happiness and their relationship to income within your study. Which of these do you think is the most important in terms or most directly correlated to happiness?
According to our study, the most important domain of happiness is economic happiness and job happiness. Income is the primary factor of economic happiness. This in a sense transcends into the other domains. If one has a stable means of income it leads to stability in other domains such as social, marital and housing happiness.
Given that the Easterlin Paradox has many blind spots such as barter goods, the black market and household production. How did you nullify or decrease the effects of these issues in your study?
In his first article regarding Easterlin Paradox, which was published in 1974, Richard Easterlin takes into account GDP per capita. However, GDP calculations have these particular blind spot therefore it faces criticism as a factor for these calculations. In their research paper ‘Rising Income and the Subjective Well-Being of Nations’, Ed Dienerof University of Illinois and his colleagues suggested the use of mean household income instead. We also focused on household income for our study. It is a micro econometric approach where we did not take GDP into account.
Do you think these studies should be conducted in more third world countries in order to elaborate upon income disparity?
When collecting data about individual happiness, well being and quality of life come into light; Nobel laureates such as Joseph Stiglitz and Amartya Sen have emphasized this as an effective means to determine the quality of life. We have found that relative income and social pressures in these areas affect an individual’s happiness. Determining the dynamics of how income changes their social premise as well as other aspect of their lives will allow researcher to understand the population of that particular area.
Why do you think that the overall happiness for a respondent of Bangladesh is more associated with marriage and happiness as opposed to housing conditions and economics?
We looked into unobserved heterogeneity in this case because personality traits or other characteristics can affect their responses in this case. Given that this is the case; we looked into these personality traits and their effects. The phenomena that marriage has a pronounced effect on overall happiness are apparent in all nations; we attribute this phenomenon to compensation for lack of satisfaction within economic and housing domains. These social factors are taken into account as the discrepancies between the study of economic wealth and happiness.
Could you please explain the idea of Easterlin Paradox and its theory regarding wealth distribution?
Easterlin himself describe his theory in his paper ‘Does Economic Growth Improve Human Lot.’ He looked into the association of income (GDP per capita) and happiness. He theorized that higher levels of income do not being happiness atsocietal level, which is poulaly known as the Easterlin paradox. Easterlin focused on three questions: are rich people happier than poor people at an individual level? Were rich countries happier than poor countries and whether the happiness levels of countries increase with the wealth of a nation (GDP growth)?
What was one of the unexpected results you have found in your study?
We find that there is nonlinearity when one looks at the wealthier class, when observing economic happiness. Another study focusing on Bangladesh,also shows a satisfaction of relative income amongst those who do not have significant financial means. We have come to the inference that in these areas though the incomes of individuals are much less, when they compare their income to the relative income of other, there is not a significant difference. When we come to higher income level, there might be a greater degree of competition in a smaller pool of individuals. This may lead to a greater degree of comparison amongst peers and a sense of discontent with one’s income.
