If money can’t buy happiness, can redistributive social policies do the trick? In their research on state intervention in various socially democratic welfare states, Hiroshi Ono and Kristen Schultz Lee examine how welfare expenditures and taxes affect the happiness of citizens. Writing in Social Forces, Ono and Schultz not only report that money does buy happiness, but also that using public social expenditures to protect populations from social risk is a wise investment.
Using data from the 2002 International Social Survey Program’s (ISSP) “Family and Changing Gender Roles” module, the authors use individual-level factors including gender, marital status, and income to predict reports of happiness in Eastern European countries. Countries are classified as either low- or high-PSE (Public Social Expenditure) depending on levels of social welfare funding.
Among their findings, women and men are equally happy regardless of the size of the welfare state. The happiness gap between married couples and non-married persons is greater in high-PSE countries, suggesting that countries with higher social expenditures are home to happier marriages. Cohabiters, too, are also nearly three times happier than non-married, non-cohabiting individuals in high-PSE countries. And even low-income people are happier in high-PSE countries compared to their counterparts in low-PSE countries. Social welfare programs seem to help both the economic security and the subjective wellbeing of the poor. Still, the authors emphasize that public social expenditures do not invoke happiness among all citizens.
The redistribution of income reduces the happiness gap between the rich and the poor: The happiness of the poor is lifted, and the happiness of the rich is lowered.
Countries attempting to mitigate various forms of “happiness inequality” through investments in safety nets may learn that achieving a state of happiness may not be as expensive as they thought. It just might lead to a few grumpy 1%’ers.