Freakonomics: Debunking the Easterlin Paradox, Again

Mick West

Staff member

For those of you new to the debate, the story begins with a series of papers that Richard Easterlin wrote between 1973 and 2005, claiming that economic growth is unrelated to life satisfaction. In fact, these papers simply show he failed to definitively establish such a relationship. In our 2008 Brookings Paper, Betsey and I systematically examined all of the available happiness data, finding that the relationship was there all along: rising GDP yields rising life satisfaction. More recent data reinforces our findings. Subsequently, Easterlin responded in a pair of papers circulated in early 2009. That’s the research journalists are now asking me about. But in a paper released several weeks ago, Betsey, Dan Sacks and I assessed Easterlin’s latest claims, and found little evidence for them.

A bit of a dry article, but it's a topic that is of interest to many. Should the government focus on economic growth? What's actually important here? Given that rising GDP would seem to be unsustainable in the long run, what's the end-game?