How should we encourage people to adopt more healthy lifestyles?

Timothy Wilson’s book, ‘Redirect: The Surprising New science of Psychological Change’, is primarily about what he describes as ‘story editing’ – a set of techniques designed to redirect people’s narratives about themselves and the social world in a way that leads to lasting changes in behaviour. Some of this story editing involves writing exercises, such as becoming more optimistic by writing about the process by which you have enabled everything in your future life to go as well as it could. But story editing also involves such things as providing information about social norms to correct mis-perceptions about what everyone else is doing. I suggest that anyone interested in a brief overview of the book should take a look at theinterview of Tim Wilson by Gareth Cook, for ‘Scientific American’ and a reviewby Mario Popova for ‘The Atlantic’.

I want to focus here on what light the book sheds on how we should encourage people to adopt more healthy lifestyles. Some people who are reading this will be thinking that I must have worked in the public sector for too long and become addicted to the ‘we’ word. Why should ‘we’ encourage people to live healthy lifestyles? Shouldn’t ‘we’ mind our own business? Well, in this instance I am using the ‘we’ word because it is appropriate. I think we would all want members of our own families and our friends to live healthy lifestyles, and probably feel that it would be good to encourage them to do that.

A logical place for an economist to begin would be to consider whether incentives - rewards, threats or punishments - should be used to encourage people to adopt healthy lifestyles. The message that I get from Tim Wilson’s book is that while incentives can change behaviour, they are not likely to bring about a desired change in the way people see themselves or in their intrinsic motivations. For example, in commenting on incentive programs designed to encourage kids to read more, Wilson writes:

‘If we want kids to read more, then rewarding them can work – as long as the incentives continue to be available. Rewards can produce compliance, just as punishment can. But … we want our kids to internalize desired attitudes and values … . After all, we can’t reward them for reading a book for the rest of their lives’.

Wilson also refers to experimental evidence that rewards can actually undermine intrinsic interest in an activity by convincing kids that they are doing it for the reward and not because it is enjoyable. When the reward is removed, participation in the activity was lower than in the pre-reward baseline period.

The conclusion Wilson comes to is that parents should use rewards and threats that are minimally sufficient to get kids to do the desired behaviours, i.e. not so strong that the kids view the threat or reward as the reason they are acting that way. If the child is told you will be ‘very upset and angry’ if she does something wrong she will desist to avoid getting in to trouble. If she is told you will be ‘a little annoyed’ she will still desist because she sees herself as a good kid.

So, incentives are no panacea. What else doesn’t work? The book provides quite a few examples of programs that bring people who are considered ‘at risk’ or ‘potential delinquents’ together in various ways (boot camps, counselling sessions etc.) to try to change their behaviour. The experimental evidence suggests that such programs don’t work because people who are brought together learn from each other and identify with group norms.

Another form of intervention that apparently doesn’t work is to scare the hell out of people by showing them very graphically what might happen if they engage in binge drinking, smoke cigarettes, take drugs and so forth. Threatening people with dire consequences for doing things they don’t want to do in the first place can have paradoxical effects. For example, some people may get the message that maybe they are tempted to engage in the undesirable behaviour, after all, since people are going to extreme lengths to talk them out of it.

So, what does work? One approach that works is autonomy support.  This involves helping young people understand the value of different alternatives facing them and conveying a sense that they are responsible for choosing which path to follow.

Encouraging young people to become involved in volunteering seems to have desirable effects on many aspects of their behaviour. The author writes:

‘Involving at-risk teens in volunteer work can lead to a beneficial change in how they view themselves, fostering the sense that they are valuable members of the community who have a stake in the future, thereby reducing the likelihood that they engage in risky behaviours …’

It may be possible to encourage young people to adopt healthier lifestyles by correcting incorrect perceptions about the behavior and attitudes of other young people.  For example, there is apparently a tendency for young people to over-estimate the amount of alcohol their peers drink. When correct information is disseminated, they lower their estimates of how much their peers drink and reduce their own drinking.

I don’t think Tim Wilson makes any broad generalizations in this book about how we should encourage people to adopt healthy lifestyles. In fact, he doesn’t make many generalizations about anything. One of the important messages in the book is the need for appropriate experimental testing to see what actually works. It seems to me, however, that it would be fairly safe to conclude from the book that the best way to encourage people to adopt more healthy lifestyles is through subtle interventions that redirect the narratives that they have about themselves.

Do commercial interests have excessive influence on people in modern societies?

Jeffrey Sachs makes it difficult for any libertarians who happen to look at his book, ‘The Price of Civilization’, to consider seriously his claim that powerful corporate interests have excessive influence in America. He claims that libertarians ‘hold that the only ethical value that matters is liberty, meaning the right of each individual to be left alone by others and by the government’.

There are a lot of other ethical values that matter to me – and probably to most others who view themselves as libertarians. In my view, liberty deserves primacy only because it makes it possible for people to live in peace – with minimal coercion of one person or group by another.

Perhaps I am excessively naïve, but it seems to me that anyone who is concerned that people are being manipulated by corporate propaganda might see libertarians as potential allies. Can a case for individuals to be protected from techniques of persuasion that undermine individual sovereignty be argued along similar lines as the case for laws to protect against force and fraud? If it could be, I imagine many libertarians would support additional action to protect individual sovereignty.

Why does Jeff Sachs think that corporate interests have too much influence in America? Dr Sachs, the clinical economist, identifies a range of symptoms. The media is privately owned and funded by advertising revenue. Corporate interests generate propaganda which the media disseminates. Corporate interests largely fund campaigns of candidates for political office. People spend a lot of time watching electronic media.

Sachs writes:

‘The relentless streams of images and media messages that confront us daily are professionally designed to distort our most important decision making processes. We are encouraged to act on fantasy instead of reason’.

Cartoon by Nicholson from “The Australian” newspaper: www.nicholsoncartoons.com.au

Sachs claims that America has become a corporatocracy – a political system in which powerful corporate interests dominate the political agenda. As he sees it:

‘The media, major corporate interests, and politicians now constitute a seamless web of interconnections and power designed to perpetuate itself through the manufacture of illusion’.

So, some readers may ask, does this explain why Americans no longer see much merit in equality of opportunity, don’t think governments should do more to help people in need and don’t think the rich should pay more tax? No! Dr Sachs actually cites evidence that a high proportion of Americans still want more equality of opportunity, favour more help for those in real need who are prepared to help themselves and favour taxing the rich more heavily.

Where does that leave Dr Sach’s diagnosis? I’m not sure. Perhaps the disease has not progressed very far at this stage. Sachs claims that the patient is suffering from a disconnection between shared values and national politics. He sees the disconnection as arising from various aspects of the political system that enhance the power of corporate interests – particularly the military industrial complex, Wall Street, big oil and transport, and health care.

Jeff Sachs has left me as confused as ever about the American political system. He has not persuaded me that America is a corporatocracy. Corporate interests are powerful in America, but so is religion, the teaching profession, environmentalists, etc., etc.

It seems to me to be the main problem in American politics, which is shared by other modern societies, is the trivialization of politics by media that is primarily in the business of selling entertainment. The media can’t be expected to evaluate the claims made by interest groups, but if journalists have access to such evaluations from respected sources they can hold politicians to account for the views they express (or fail to express). Think tanks perform the task of policy evaluation to some extent, but can be too easily dismissed because they are not seen to be above interest group politics. Paradoxically, the government itself is the only organization capable of creating sources of policy advice that are sufficiently above interest group politics to have some hope of commanding widespread respect in the community at large.

Despite the reservations I have about ‘The Price of Civilization’ (in an earlier post about taxation levels as well as here) I want to end this post on a positive note. I strongly endorse Jeff’s view that individuals can benefit themselves and the societies in which they live by making efforts to become more mindful. We will do less harm and may do a lot of good if we become more moderate in our habits, achieve more balance in our lives, improve our knowledge, exercise more compassion, have more regard for the effects of our actions on the environment and future generations, consider how we can promote more constructive political deliberations and be more accepting of diversity as the path to peace.

What motivated Roger Kerr?

There isn’t anyone I have known who could match the enthusiasm and energy that Roger Kerr brought to his work. I have had the privilege of working with quite a few highly principled individuals involved in public policy work - people who are clearly motivated to a large extent by the belief that they are contributing to the greater good of society. Roger stands out, however, as a person who always seemed to be enthusiastic and optimistic – he seemed to respond to setbacks by increasing his efforts to obtain better outcomes in future. It was obvious to everyone that he had a passion for presenting his views clearly, logically and forcefully, but it would not have been obvious to casual observers what was motivating him.

In his role as executive director of the New Zealand Business Roundtable (NZBR), for the last 25 years, Roger was perceived by some people as a free market ideologue. It is evident from various speeches he gave, however, that he was somewhat bemused (if not annoyed) by that description. In a speech he gave in 2005 he suggested that to characterize policy proposals as either ‘ideological’ or ‘pragmatic’ is at best a confusion and at worst a rhetorical trick that appeals to anti-intellectualism as a substitute for serious argument. He made the point that everyone involved in the debate about public policy argues on the basis of some set of principles or ideas, whether or not they are conscious of them or make them explicit. He also suggested that serious policy debate cannot proceed unless ideas are articulated and tested. His support for free markets was not unbounded. It was based ultimately on pragmatic grounds – evidence that free market outcomes are generally superior to the alternatives. I think Roger viewed himself as a principled empiricist.

In his eulogy to Roger, Bryce Wilkinson, who worked closely with him over many years, mentioned that Roger seldom spoke about his motivations and never wore his heart upon his sleeve. Bryce notes that at some point early in his career as a diplomat - when Britain entered the EEC - Roger decided that New Zealand's economic decline was in fact largely self-inflicted. That prompted him to transfer to the New Zealand Treasury in 1976 and to relaunch his career doing an economics degree part time. Roger’s interest in economic policy was prompted by a desire for New Zealanders to be able to enjoy more prosperous and satisfying lives. Bryce provides evidence that Roger cared particularly about the effects of bad policies on those who are most vulnerable.

Bryce argues that Roger's optimism was based on his belief that ideas actually matter in policy debates. In support, Bryce referred to an essay that Roger wrote on the subject of ideas, interests and policy advice on leaving the Treasury in 1986.

I have just re-read the version of this essay that was published in ‘World Economy’ in June 1987. In this article, Roger argued that economic policy advisors should be aware that they do not have a comparative advantage in making judgements about what courses of action might or might not be politically feasible.

Roger noted:

Perceived political constraints are not always immutable. They can be shifted by reasoned analysis and well-constructed strategies for policy change … . Second-guessing political reactions can lead to a narrowing of policy options and does less than justice, in recent New Zealand circumstances at least, to the intelligence of a number of politicians, on both sides of the political fence, who have been more aware of the gravity of New Zealand’s economic problems and prepared to tell the story like it is than many of their advising bureaucrats’ (pp144-5).

Roger also noted the importance of institutional structures in determining policy outcomes:

‘There is an important role for public information, open government, policy transparency and public inquiry processes in order to expose to critical scrutiny the claims of special interest groups and the performance of bureaucrats (including the propensity of some of the latter to act as taxpayer funded lobbyists for some of the former)’ (p 150).

Roger also made the claim ‘that the emergence of interest groups with broad representation, which are thus forced to take more of an economy-wide view, may be a source of influence which is more coincident with the interests of the community at large’ (p 150). That claim might seem excessively modest in the light of the subsequent performance of the NZBR – but Roger played an important role himself in ensuring that the NZBR maintained an economy-wide focus. A decade ago, New Zealand Institute of Economic Research chairman Michael Walls said of Roger:

‘No single individual has done more over the last 15 years to persuade important parts of the business sector to support economic policies which, though often contrary to the interests of individual firms, were in the interests of the country as a whole.’

Roger was motivated by a desire to play a part in promoting policy reforms – to avoid further economic decline and to enable New Zealanders to enjoy greater economic opportunities. He was enthusiastic because he knew he was fighting the good fight and he was optimistic because he knew that good policy evaluation and advice can make a difference. Above all, Roger was motivated by the impulse to ensure that his life was meaningful.

I urge readers to take a look at the many personal tributes to Roger that can be found on his blog.

Should we be more concerned about the policies being followed by the European Central Bank?

Jim was obviously agitated by my response to his question. He had just asked me whether I thought that the latest political deal in Europe would resolve the European financial crisis. Instead of saying I didn’t know I had tried to list some relevant factors, none of which I knew much about. I ended my list by mentioning that the policies being followed by the European Central Bank (ECB) were preventing the governments of southern Europe from following their pre-euro strategy of using high inflation to fund their profligacy.

‘I suppose that means you would be a strong supporter of the ECB’s anti-inflation policies’, Jim said. ‘You were an inflation hawk back in the 1980s. And I can remember a discussion in 2006 when you told me you were worried about expectations of higher inflation in America and the possibility of a re-run of the stagflation of the 1970s and 1980s. A year or so later inflation expectations started to fall. Then in 2008 we had the global financial crisis and it became obvious to everyone that there was actually more reason to be concerned about deflation than inflation’.

Jim was right about the 1980s, but I couldn’t recall our conversation in 2006. I pointed out that it wasn’t necessarily inconsistent to be concerned about rising inflation expectations in 2006 and to be concerned about the emergence of deflation a couple of years later. I suggested that central banks should be aiming to keep inflation expectations low and stable.

Jim said: ‘The fact that you keep talking about inflation expectations suggests you must have read some of the material on Scott Sumner’s ‘Money Illusion’ blog.  I started to try to explain that Scott actually recommends that central banks should target NGDP (nominal GDP i.e. aggregate demand) rather than inflation expectations, but Jim cut me off. He said: ‘I followed the link on your blog to Sumner’s blog to try to understand the European financial crisis. You obviously haven’t read whatSumner wrote a couple of weeks ago about the ECB’.

I had to admit that I haven’t been reading Scott’s blog regularly over the last couple of months. Jim said that in the post about the ECB Scott had a chart about inflation expectations in Europe that had been sent to him by Lars Christensen. At that point Jim got slightly distracted. He told me that I should read a post that Christensen had written recently on his blog, ‘The Market Monetarist’, about Calvinist economics and the gold standard mentality. ‘Christensen must have written that post with people like you in mind’, Jim said.

Jim eventually came back to the chart showing inflation expectations in Europe. He explained that the chart implies that the ECB has been driving inflation expectations sharply lower during August and September despite its mandate to produce stable inflation.

Jim ended by saying: ‘Look, why don’t you write something on your blog telling people to read Scott Sumner’s post about the ECB. And don’t forget to quote the passage where he points out how why it is so important for inflation expectations to be kept stable in Europe at present’.

I’m not sure which passage Jim wants me to quote, but this one seems to capture the main point:

‘I’m not saying a policy of steady eurozone inflation would solve the debt crisis, obviously it wouldn’t.  But the current policy is making it far worse than it needs to be.  The US made the same mistake in mid-2008.  Even at that time the subprime crisis was well understood, and estimated losses to the US banking system were quite high.  But when the Fed drove NGDP expectations much lower in late 2008 … the debt situation got far worse, and spread far outside the original subprime sector.  Now we are seeing the euro sovereign debt crisis spread to more and more countries.’

Perhaps we should be more concerned about the potential effects of the aggressive anti-inflation policies being followed by the ECB. 

Will Bhutan succeed?

Some readers will know exactly what I mean by this question. Others may be wondering: Where is Bhutan? What does he mean by success? And why should we care?

Bhutan is a small country which has not had much exposure to the modern world. The first roads were built in the 1960s and TV was only introduced in 1999. It is located at the eastern end of the Himalayas, sandwiched between India and China. It covers about the same area as Switzerland and has a population of about 700, 000 people. About 75% of the population are Buddhists and most of the remainder are Hindus of Nepali descent.

The 'Tiger's Nest' monastery, near Paro

What do I mean by success? About 40 years ago the former king of Bhutan famously declared that ‘gross national happiness is more important than gross national product’. This play on words led eventually to gross national happiness becoming a national objective of Bhutan. In terms of this objective, Bhutan will succeed if it can modernize so that the people can enjoy the benefits of the modern world, without major social problems, loss of culture or environmental damage.

Why should we care? Bhutan’s approach to pursuit of happiness is a social experiment that is attracting a lot of attention around the world. A few months ago the United Nations General Assembly accepted unanimously a resolution sponsored by Bhutan which recognizes the pursuit of happiness as a universal goal. In the years to come we can expect to hear a lot about the success or otherwise of Bhutan’s approach to pursuit of happiness.

So, will Bhutan succeed? If we look at the matter from a management perspective, some of the necessary conditions for successful pursuit of goals have been established: 

• The government has a fairly clear view of what pursuit of gross national happiness means. It involves promoting socio-economic development and good government (including a vibrant democracy), while preserving cultural heritage and protecting the environment.
• Surveys are being conducted to monitor progress. The surveys monitor the views of the people about the performance of government as well as resilience of cultural traditions, ecological knowledge, living standards and psychological well-being. 
•  Survey results are used in de veloping policy e.g. a finding that meditation was not being practiced as often as expected led to meditation classes being offered in schools.

   

Archery: the national sport and an important cultural activity 

The chances of success might look good from a management perspective, but will the people of Bhutan actually be any more successful in coping with the modern world than the people in other countries have been?

The first point, which seems obvious to me from my short visit, is that most of the people of Bhutan, like most people elsewhere, want the amenities of modern life. The more they know about how people live in wealthy countries, the more they are likely to aspire to have the stuff that people in wealthy countries take for granted – the household items that take the drudgery out of life, the phones and internet access that enable us to stay in touch with each other, motor vehicles – all that and more. It will become obvious to an increasing proportion of Bhutanese that a lot of this stuff can be useful - even though they may be happy with what they have at the moment.

My second point is that Bhutan’s government is not likely to come under much, if any, pressure from the public to sacrifice environmental or cultural objectives to achieve a higher economic growth rate. There is considerable potential for economic development that does not involve major conflict with environmental or cultural objectives. For example, there is potential to sell more hydro power to India and to expand tourism based on cultural and environmental resources.

The big question, in my view, is the extent to which Bhutan will be able to obtain the benefits of modernity without ending up with the social problems of modern societies? How will they cope with the potential for weakening of traditional values and support systems as larger numbers migrate from rural areas in search of a better life in the cities? How can they ensure that young people continue to acquire social values and avoid the weakening of the social fabric (which seemed evident, for example, in the orgy of rioting and looting in London a couple of months ago)? How can they provide a social welfare safety net without ending up with large numbers dependent on welfare benefits? How can they avoid the excesses of a consumer society, with substantial numbers of people incurring excessive debts to live unaffordable lifestyles? How can they avoid having large numbers of people living unhealthy lifestyles, addicted to TV or the internet and vulnerable to inducements of advertisers?

I think there are grounds for hope that the government of Bhutan will learn from the mistakes of other countries and come up with sensible answers to such questions. It is obvious from the international conferences it has been holding that the government is actively seeking to learn from experiences of other countries. The way survey results are being used also provides grounds for hope that Bhutan will succeed. For example, the emphasis that the government is placing on providing opportunities for children to learn skills in mindfulness makes me hopeful that young people in Bhutan are more likely to learn as they grow up that it is their individual responsibility to make best use of the opportunities available to live a meaningful life. What that means at a practical level is learning to accept responsibility for the important choices in their lives, including choices about such mundane matters as what to eat and when to switch off the TV.

On balance, I think there is a better than even chance that Bhutan will succeed in modernization with fewer social problems than have been experienced elsewhere in the world.

Thimphu: the capital city of Bhutan

What is the price of civilization?

According to Jeffrey Sachs, in his new book ‘The Price of Civilization’, the United States needs an increase in tax revenue equal to about 6 percent of GDP in order to balance the budget and ‘pay for civilization’. He arrives at this figure after making allowance for some cuts in government spending and increases in spending of about the same magnitude in areas such as education, training, childcare, infrastructure modernization and foreign aid.

Jeff Sachs asks himself a ‘crucial question’: ‘how do Canada, Denmark, Norway, Sweden, and other countries manage to educate their young, fight poverty, modernize their infrastructure, enjoy life expectancy well above America’s, and still maintain a budget that is more in balance than America’s?’ He concludes: ‘The answer, of course, is that the other countries tax their citizens more heavily in order to supply more public goods, including in the case of the Scandinavia, universal access to health care, higher education, and child care and support for families with young children’.

Jeff’s revenue-raising proposals would increase America’s tax revenue as a share of GDP to a magnitude similar to that of Canada, New Zealand and Britain. He points out that America’s tax revenue as a share of GDP is currently current second-lowest among the high-income jurisdictions considered, ‘just slightly larger than Australia’. (The comparison doesn’t include Singapore or Hong Kong.)

I was surprised to see that America now has a bigger government than Australia. This must have something to do with the relatively poor economic performance of the US over the last couple of years. It certainly can’t be attributed to any recent cuts in government spending in Australia.

But let us not get side-tracked by the trivia of short-term movements in GDP. There is a fairly clear implication in what Jeff has written that he thinks Australia must be uncivilized because tax revenues as a share of GDP are relatively low in this country.

Australians are so used to being told that they are uncivilized that they rarely take offence. But it is surprising to see this implied in the writings of an American. We tend to associate the view that Australians are uncivilized with chinless members of the English aristocracy, rather than people who espouse democratic principles.

Nevertheless, I think Jeff may have a point. I don’t want to undermine the efforts of Australia’s foreign minister to portray us as civilized people, but it is a difficult case to make. Australians generally make little effort to even appear to be civilized. Most of us require very little lubrication before singing our national song, which is a eulogy to a hobo who steals sheep. With very little more lubrication many of us can be encouraged to sing an advertising jingle we learnt as children, that identifies us ‘as happy little Vegemites, as bright as bright can be’. In this instance it may be equally true that ‘what we identify with establishes our identity’ and that ‘we are what we eat’!

More seriously, perhaps, it is difficult to argue that social outcomes in Australia are up to the standards that might be expected of a civilized country. Australia’s rating according the UN’s human development index (HDI) is only 0.937, just 6 percent higher than that for Sweden. When inequality is taken into account, our performance is even worse – a rating of 0.864, just 5 percent ahead of that for Sweden. Average life expectancy at birth in Australia is only 81.9 years, just a few months ahead of Sweden. Australians only spend about 12 years at school on average, again only a few months more than Swedes. In the few years Australians do spend at school, they don’t actually learn much. Not only are our PISA scores well below those in Shanghai and Korea, they are only slightly higher than those for Sweden.

I hope that anyone from Sweden reading this has a sense of humour. My real point is not that Sweden is uncivilized – just that it is not high levels of taxation that make Sweden a civilized country. Those who argue that Sweden is civilized because it has a big government should consider how they would respond to the view that Sweden is civilized country because it generally adopts market-friendly policies. According to the Heritage Foundation’s measures of economic freedom, Sweden’s policies are more market-friendly than those in the United States in relation to business, trade, investment, finance, monetary policy and corruption - just about all aspects of policy other than size of government and the labour market.

The general point I have been trying to make (in case anyone has missed it) is that it doesn’t make much sense to equate civilization with the size of government. Social outcomes in high-income countries with big governments tend to be fairly similar to those of high-income countries with smaller governments. It is possible to provide a decent social safety net, without huge levels of taxation if benefits are means tested. I have provided some references to research on this topic in a paper I wrote last year for New Zealand’s 2025 taskforce (‘How much does size of government matter for economic growth?’, 2010, p11).

I started off to review ‘The Price of Civilization’, but I haven’t progressed very far. The recommendation for higher taxes is probably the most important recommendation in the book – and it is the issue raised in the title – but that is only part of what the book is about. In particular, the book contains an interesting discussion about what is wrong with American politics, which I will consider in a later post.

Are freedom and trust linked to social values and support for free markets?

In my last post I presented a table showing that countries in which people have strong social values tend also to have high proportions of the population supporting free markets. Unfortunately, that table is difficult to read because of the amount of information it contains, so I am presenting a ‘pruned’ version below.


Apart from presenting fewer indicators, the main difference has to do with the ranking of countries. In my last post, the countries are ranked according to levels of interpersonal trust. In the table below, the countries are ranked by an index (not shown) that gives equal weight to interpersonal trust and feelings of individual agency. As before, each entry in the table is presented against a green, yellow, orange or red background depending on how favourable it is to either the market economy or community values.

The table suggests that values supporting both community and free markets tend to be stronger in countries in which there are relatively high levels of trust (or absence of distrust) and relatively strong feelings of individual agency (a high proportion of individuals who feel that they have some freedom of choice and control of their lives). It seems reasonable to expect that societies that encourage tolerance and respect for others, as well as confidence in the justice system, would tend to foster both trust and the feelings of agency that are necessary for entrepreneurial innovation. Paul Zak and Stephen Knack noted that high levels of trust are favourable to economic activity because they reduce transactions costs (‘Trust and Growth’, The Economic Journal, 2001). Zak has argued subsequently that moral behaviour - i.e. trustworthy behaviour - is necessary to reduce cheating without exorbitant transactions costs. It also enables employees, for example, to be given greater opportunities for self-direction (Zak, ‘Moral Markets’, 2008, xvii and 273).

Favourable economic outcomes generated by relatively high levels of trust and strong feelings of individual agency could be expected to generate attitudes more favourable to the functioning of a market economy. As noted in a recent post, individuals with relatively strong feelings of agency tend to have favourable attitudes towards markets.

The next step in the analysis is to consider the available evidence on changes over time. What changes have occurred in community values in market economies over the last couple of decades?

Why do people in countries with strong social values tend to support free markets?

This question presupposes that people in countries with strong social values do actually tend to support free markets. Some evidence in support of this is provided in the table below.


The table has been constructed from information in the World Values Surveys conducted in 2005 to 2008. Countries are ranked by levels of inter-personal trust i.e. the percentage of people who are more inclined to agree with the proposition that ‘most people can be trusted, rather than that ‘you can’t be too careful’. Each entry in the table is presented against a green, yellow, orange or red background depending on how favourable it is to either the market economy or community values. Further information about the definition of the variables in the tables may be obtained from the last couple of posts (here and here).

Hint: If you click on the table you might still need a magnifying glass to read it!

The fact that there is more green and yellow at the top of the table and more red and orange at the bottom reflects a positive relationship between values supporting the market economy and community values. Why is this so? I suspect the answer has to do with the development of institutions that support both inter-personal trust and strong feelings of individual agency.

I will write more about this later (and possibly present some information from the table in a more readable form).

Do people who have negative attitudes toward wealth accumulation have greater concern for community?

If people are cynical about the potential for everyone to share in the benefits of wealth creation it might seem reasonable to expect they would tend to have relatively more concern for community. If they think it is only possible for individuals to get rich at the expense of others, it might be reasonable to expect them to have a particular concern for helping other people and/or protecting the environment. On the other hand, as noted at the end of my last post, people who have strong feelings of individual agency - who tend to have positive attitudes toward wealth accumulation – do not tend, as a group, to be particularly selfish in their attitudes.


The simple analysis I have used to test these conjectures has involved comparing responses in the World Values Survey (WVS) to a range of questions relating to attitudes toward community of people with relatively negative and relatively positive views about capital accumulation. In asking about attitudes toward wealth accumulation, the WVS specifies a rating of 1for agreement that ‘people can only get rich at the expense of others’ and of 10 for agreement that ‘wealth can grow so there’s enough for everyone’. Data used in this exercise are from the 2005-2008 survey covering about 75,000 people in 57 countries.

The results of the exercise are reported in the following chart. For the purpose of constructing the chart, responses to the capital accumulation question of 1 to 3 have been labelled ‘negative’ and responses of 8 to 10 have been labelled ‘positive’.

The chart suggests that there isn’t much difference, on average, between the social values of people with positive and negative attitudes towards capital accumulation. People with positive attitudes seem to somewhat less selfish than those with negative attitudes on all the items considered.

Some readers might be wondering whether this finding reflects a greater concentration of people with negative attitudes toward capital accumulation in countries in which the social fabric tends to be weaker. If that is so, it is not likely to be entirely coincidental. The question deserves further research.

Are attitudes towards success, wealth accumulation and competition linked to feelings of individual agency?

People with strong feelings of agency feel that they have a great deal of choice and control over the way their lives turn out. As shown in the charts below, such people tend to have more positive attitudes toward hard work and success, wealth accumulation and competition. However, people who do not feel that they have a great deal of choice and control do not, in general, seem to be particularly cynical; they are just tend to be less positive than those with strong feelings of agency.


Readers who would like to know why I am considering questions such as this might find an answer in an earlier post.

The data used in this exercise are from the World Values Survey 2005-2008 which surveyed about 75, 000 people in 57 countries. The question concerning feelings of agency asks respondents how much freedom of choice and control they feel over the way their lives turn out. A rating of 1 means none at all and a rating of 10 means a great deal. The average rating is 7. Ratings of 1 to 4 are relatively uncommon and responses with those ratings have been aggregated in the charts shown below.

The first chart shows how responses relating to attitudes towards the relationship between hard work and success vary among people with stronger and weaker feelings of personal agency. The survey asks whether respondents agree with the statement ‘hard work brings success’. A rating of 1 means that ‘in the long run hard work usually brings a better life’, whereas a rating of 10 means that ‘hard work doesn’t bring success – it is more a matter of luck and connections’. Ratings have been aggregated in the chart to show the differences more clearly; ratings 1to3 have been labelled ‘positive’, ratings 4 to 7 have been labelled ‘mixed’ and ratings 8 to 10 have been labelled ‘negative’. The data in each of the charts add to 100% on the depth access (i.e. for each level of agency, the red, blue and green columns added together equal 100%) .

The second chart shows how responses related to attitudes toward wealth accumulation vary among people with different feelings of agency. The survey question asking about attitudes toward wealth accumulation specifies a rating of 1for agreement that ‘people can only get rich at the expense of others’ and 10 for agreement that ‘wealth can grow so there’s enough for everyone’. Ratings 1-3 have been labelled ‘negative’, ratings 4-7 have been labelled ‘mixed’ and ratings 8-10 have been labelled positive.

The third chart shows how responses related to attitudes toward competition vary with agency. The survey question specifies a rating of 1 for agreement that ‘competition is good; it stimulates people to work hard and develop new ideas’ and of 10 for agreement that ‘competition is harmful; it brings the worst in people’. Ratings have been aggregated and labelled as for the first chart.

The pattern shown in all three charts is fairly similar with people who have strong feelings of agency tending to have more positive attitude toward success from hard work, wealth accumulation and competition. This result was much as I had expected but I had thought the attitudes shown by people with relatively low agency might be somewhat more negative than they appear to be.

What do the results mean? Previous research has suggested that feelings of agency are related to the amount of freedom that people actually experience in their lives. The results suggest that people who feel a lot of freedom tend to have more positive attitudes toward success from hard work, wealth accumulation and competition.

Previous research suggests that people who have strong feelings of agency are not particularly selfish in their attitudes. I wonder whether that is also true of people who have positive attitudes toward wealth accumulation.

Postscript:
That question is followed up here and here.

Is Maslow's hierarchy of needs a pernicious doctrine?

I recently heard a distinguished economist claim that Abraham Maslow’s hierarchy of needs is a ‘totally pernicious doctrine’. He expressed a strong objection to the idea that ‘first you have to satisfy the body and, only when you have done this can you satisfy the spirit’. I will refrain from naming the individual and providing a link to his remarks because I am not sure that the comment represents his considered view. He might have just been intending to provoke further thought about Maslow’s theory.


Maslow presented his hierarchy of needs as a theory of motivation in a paper written in 1943. He suggested that a person who is lacking in food, safety, love and esteem would probably hunger for food more strongly than anything else. He hypothesized that humans are motivated by a hierarchy of needs, which they seek to satisfy in the following order: physiological, safety, love, esteem and self-realization. He acknowledged that the order of need gratification might not be as rigid as this ranking implies and that it was not necessary for a particular need to be entirely satisfied before a higher need emerged.

It seems to me that the idea at the core of Maslow’s theory is that gratification of the most basic needs releases a person to focus on higher needs. This idea of natural progression to satisfaction of higher needs is the opposite of extreme asceticism which implies that higher needs can only be met through denial of desire. There may also be some tension between Maslow’s view and the Buddhist view that gratification of desires can be addictive, as explained by Lam Goembo Dorji in a recent paper.

In testing Maslow’s theory it seems to me that the central issue is the extent to which people actually move on to satisfy higher needs as their incomes rise. Maslow’s theory should be rejected if most people do not respond to rising incomes by moving on to satisfy higher needs. It ought not to be rejected just because a few relatively enlightened people are able to flourish even though they have relatively low incomes.

A recent study by Louis Tay and Ed Diener tests Maslow’s theory using data from the Gallup World Poll as indicators of the needs identified by Maslow. The authors found some support for Maslow’s theory in that people tend to achieve basic and safety needs before other needs. They also found that fulfilling the various needs has relatively independent effects on subjective well-being, so humans can derive happiness by simultaneously working on a number of needs regardless of the fulfillment of other needs. (The paper, entitled ‘Needs and Subjective Well-Being Around the World’, JPSP (2011) can be obtained here, and Bridget Grenvill-Cleave has written a good summary here.)

There are some other posts on this blog that are relevant to the priority that people give to various needs. In a recent post I discussed evidence presented by Christian Welzel and Ronald Inglehart that as the contribution of greater financial satisfaction to overall life satisfaction has become ‘saturated’ to a greater extent with higher levels of economic development, people tend to achieve higher life satisfaction to a greater extent through activities that enhance feelings of agency.

In the post entitled ‘Does the law of diminishing returns apply to a level of achievement?’ I used Australian survey data to explain life satisfaction in terms of levels of satisfaction with seven domains: standard of living, health, safety, relationships, community connectedness, future security and achievement. Best fit was obtained from a linear function, suggesting that the various domains have independent effects on life satisfaction. However, satisfaction ratings in the various domains are correlated - for example, there is a relatively high correlation between satisfaction ratings for relationships and achieving.

In a related study (reported here) I attempted to identify whether high satisfaction in any particular domains of life are more necessary than others to high satisfaction with life as a whole. The criterion used was the percentage of respondents with high satisfaction with life as a whole among those with low ratings on particular domains of quality of life. The relevant percentages were follows (ranked in order of importance of each domain): personal relationships 10.8%, achieving in life 11.8%, standard of living 12.8%, future security 15.6%, health 15.9%, community connectedness 19.0% and safety 20.3%. The results suggest that satisfaction with personal relationships and achieving are more necessary to high life satisfaction of Australians than is satisfaction with standard of living and future security.

A post entitled ‘Are the world’s poor motivated solely by survival needs?’ discusses survey evidence about the ways very poor people spend their incomes. Surprisingly, they tend to spend a substantial proportion of their income on entertainment, suggesting that they are not motivated entirely by survival needs. The post discusses why this might be so and also why some wealthy people stay fixated at a materialistic level. The way people respond to experiences depends importantly on what those experiences mean to them. It is possible for wealthy people to feel deprivation and for poor people to feel that living means a lot more than meeting physiological needs.

So, where do I end up? I like the idea that self-realization is a fundamental human need that people seek to satisfy if they are able, but I don’t think gratification of desires is a particularly helpful frame of mind - individuals are more likely to realize their potential if they seek equanimity rather than pleasure. Yet, it seems obvious that human flourishing is not possible unless basic physiological needs to be met. I am impressed by the evidence that there is a general tendency for people to move on to satisfy other needs as their basic physiological needs are met. At the same time, there is plenty of evidence that some people achieve high levels of satisfaction with life at relatively low incomes and that some wealthy people are not satisfied with their high income levels. The extent to which people perceive increased economic opportunity as an opportunity to satisfy higher needs may be strongly influenced by culture, values, frames and beliefs.

Maslow may have been too simplistic in suggesting that gratification of the most basic needs releases a person to focus on higher needs, but that doesn’t mean his theory is a pernicious doctrine.

Should advertising be allowed in schools?

Nicola has sent me a message presenting the following views and providing links to a range of different web sites discussing the issues involved:

‘A school should be a simulating learning environment for our children. We trust our schools with our children to provide them with an opportunity to learn and grow. The school breaks this trust by allowing corporations to influence and manipulate their minds. As adults we have the ability to be critical of advertising, however, a school environment is one of trust, therefore, children are more likely to take the advertising at face value. Furthermore, the advertising appears to be endorsed by the school that heightens its power when compared to other contexts.

America has led the way on this form of advertising in schools. The present push by the major supermarkets to put advertising billboards on our school gates and in our schools in the form of voucher collectors is the first step. The use of TV screens with commercials and product placement in our classrooms is not far behind this. Is this the direction we want to take our education system and the welfare of our children?

There should be a blanket ban on advertising in schools as it exploits our children. In the interest of your children, please speak to your children's school management and lobby for the removal of banners and voucher collection.’

It seems to me that this is a matter that should be decided by parents’ organisations in individual schools. If parents think that some form of commercial sponsorship is an appropriate method of fund raising, why should I object?

However, there is probably no harm in expressing a personal view. In my view schools must be really desperate for ways to raise money to allow commercial organizations into schools to give prizes to kids for singing advertising jingles. What is the world coming to?

For further explanation of what Nicola is writing about, see this story in ‘The Australian’. There is a paper here discussing the methods of modern marketing being applied in schools.

Postsript:
I neglected to say that Nicola Moir is a Sydney artist.  The emphasis of her work is on what she describes as 'the forgotton spaces we inhabit between work, home and leisure' - 'the spaces where we come together as a community'. Her web site is well worth visiting. Among other things it might prompt you to consider whether you really are 'a happy little vegemite'. (For the benefit of non-Australians, the vegemite song is probably the most successful advertising jingle ever aimed at children in Australia.)

Would we be more satisfied with life if we lived in the best of all possible worlds?

How would we know if we lived in the best of all possible worlds? A possible world is not a perfect world. If we lived in the best possible world we would still be fallible humans. If you asked someone living in the best possible world how satisfied they are with their life it seems to me that they would be likely to look around at the lives that other people live and use that as the basis for their response. If Australia was the best of all possible worlds my guess is that average life satisfaction of Australians would not be much higher than their average life satisfaction has been over the last decade or so.


My point is not that life in Australia is close to the best possible, but that life satisfaction may not be a reliable indicator of whether our lives are getting better. If we lived in the best of all possible worlds, many of us would have greater opportunities than we have now and would take advantage of those opportunities to achieve better lives. However, since most of us would adapt fairly quickly to our new lives, average life satisfaction would not be much higher than it is now. We would readily acknowledge that our lives had improved, but our level of contentment would not be much greater.

Why do I think that? Well, take a look at the ABS web site showing Measures of Australia’s Progress. The picture presented there is of improvement in many aspects of well-being over the last decade, including health and education as well as income. The negative outcomes are in respect of environmental outcomes that tend not to be at the front or our minds when we think of our personal well-being. (In the best possible worlds our consciences might be more troubled by negative environmental impacts of our actions, but this would have led us to reduce such impacts.) On balance, the indicators suggest that the personal well-being of most Australians has improved substantially over the last decade.

Now, take a look at the chart below showing what has happened over the last decade to average life satisfaction and the personal well-being index produced by Australian Unity and the Australian Centre on Quality of Life. The life satisfaction rating is derived by asking respondents to give a rating from 0 to 10 in response to a single question: ‘Thinking about your own life and personal circumstances, how satisfied are you with your life as a whole?’ The personal well-being index is the average of satisfaction for a range of life domains including standard of living, health, achieving in life, personal relationships, feeling part of the community and future security.

Australians were apparently more satisfied with life than usual at the time of 2004 Olympics and less satisfied than usual during the onset of the global financial crisis, but there is not much change in either index over the decade as a whole. The same survey asks respondents how satisfied they are with the economic situation in Australia. Ratings of the economic situation fluctuate far more than the life satisfaction responses, but there is still not much evidence of an upward trend reflecting the growth in real income levels over the decade.

The chart also shows that ratings of the economic situation have fluctuated more or less in line with the consumer confidence index produced by Roy Morgan research. This consumer confidence index is constructed from answers to questions about current economic conditions and economic conditions over the next five years as well as family finances and whether or not this is a good time to buy major household items.

The following chart shows how responses to the question about economic conditions over the next five years have fluctuated in the recent past. Over the last year or so, a lot of us have tended to become more pessimistic about the economic outlook.

Fortunately, our satisfaction with our own lives does not fluctuate to the same extent as our assessments of the economic situation. Both types of measure have the same deficiency, however, as indicators of progress or regress. When we are asked to rate our own lives or the state of the economy we tend not to look back and reflect upon changes that have occurred unless we are asked explicitly to do so.

The Gallup World Poll asks respondents to rate their lives five years ago and five years ahead as well as their life today, all relative to the best possible life. The results provide an indication of whether survey respondents perceive that their lives are getting better. The average rating Australians give for their current life in 2011 is 7.4 and their rating of life in five years is 8.0 . In 2008, Australians rated their life five years previously at 6.8 . I don’t know why the data is so patchy, but it does suggest, nevertheless, that Australians perceive that their lives have improved over the last decade.

Which is the more appropriate policy objective: opportunity or contentment?

Carol Graham’s new book, ‘The Pursuit of Happiness’, makes an important contribution to consideration of the relevance of happiness research to government policy because it considers explicitly which dimensions of happiness are most relevant as public policy objectives. Happiness researchers have previously argued in favour of particular definitions of happiness - for example positive feelings, emotional well-being, satisfaction with life, capability or opportunity – without much consideration of the relevance of their favoured definitions to public policy.

Early in the book, Carol suggests: ‘A plausible assumption is that most societies would be interested in maximizing the number of citizens who believed they were leading purposeful lives but less concerned about how often people had smiled yesterday. Yet even that statement reflects normative priors that might not apply to all cultures and societies, some of which might emphasize the importance of contentment in day-to-day living more’ (p.30).

Near the end, she comes to the conclusion that a policy that aims to guarantee contentment to all citizens, rather than the opportunity to pursue a fulfilling life, ‘might be unacceptable in most societies’ (p 122). Carol also acknowledges that measures of subjective well-being can contribute to better government policies by making policy process better informed, irrespective of whether any particular dimension of happiness is pursued explicitly as a national objective.

The public policy choice between pursuit of contentment and widespread opportunity is characterised in this book as a choice between Bentham and Aristotle, with Bentham in favour of maximizing the contentment (or pleasure) of the greatest number and Aristotle in favour of maximizing the number of people who have the opportunity to lead a meaningful life (i.e. to flourish). This might be a little unfair to Bentham, who held that utility includes anything that ‘tends to produce benefit, advantage, pleasure, good or happiness’, which would certainly encompass the opportunity to lead a meaningful life. Nevertheless, many Benthamites have tended to equate happiness with pleasure and even J S Mill, who sought to distinguish between the merits of higher and lower pleasures, saw both tranquillity (contentment) and excitement as the main constituents ‘of a satisfied life’.

The opportunity to lead a meaningful life implies agency, which Carol defines as ‘the capacity to make choices and act on them’ (p 41). She perceives individual agency to be limited by income, education and information constraints as well as institutional constraints, i.e. by all factors that limit individual opportunity.

So, doesn’t greater agency or opportunity lead to greater contentment? Not necessarily. Carol points out that people with limited wealth often report being very happy while people who are in the process of obtaining higher levels of wealth (frustrated achievers) often report feeling miserable. She suggests that the way people answer happiness questions in surveys is to a large extent determined by their agency. The process of acquiring agency may produce short term unhappiness because of uncertainty associated with the adjustment process (e.g. in relocation away from family and friends) and if expectations of a more fulfilling life do not materialize this could result in lasting unhappiness.

Doesn’t this make contentment a more appropriate objective than agency? If the peasants are happy with their lives as they are, why seek to improve the opportunities available to them? I think Carol provides a good answer to these questions. She points out that while adaptation to circumstances is usually positive from an individual psychological perspective, it can lead to collective tolerance for a bad equilibrium. For example, crime and corruption have less effect on subjective well-being in countries where crime and corruption have become an entrenched feature of society. This should not make it any less desirable to reduce crime and corruption in such places.

The numerous examples that Carol draws from her research experience to illustrate the points she is making help make this book a pleasure to read. Readers are told about happy peasants and frustrated achievers in Latin America; about survey respondents in Afghanistan who are apparently happier than the world average despite objective conditions that are markedly worse; about migrants who are markedly less happy than the average for the countries they have migrated to; and about obese people who are less happy than the non-obese, but much less unhappy when there are more obese people around them.

My only reservation about the book is that I am not persuaded that the unhappy growth paradox – lower average happiness in countries with relatively high rates of economic growth after controlling for per capita income levels – is largely attributable to unhappiness associated with the process of acquiring agency. As I have suggested before, I think the unhappy growth phenomenon might disappear if researchers could control for wealth rather than income levels. The appearance of unhappy growth might largely reflect the influence on well-being of wealth (reflected in quality of housing, financial assets, human capital, public infrastructure, social capital etc.) which may take several decades to accumulate.

However, that is a minor reservation. I have no hesitation in recommending this book to anyone who is interested in the role of government in the pursuit of happiness.

Postscript:
A recent conference presentation by Carol Graham on 'Happiness around the World: The Paradox of Happy Peasants and Miserable Millionaires' is available here.

Is the social fabric stronger when a high proportion of the population identify with helping the people nearby?

In my last post I presented some evidence that people who do not identify strongly with ‘always behaving properly’ nevertheless tend to identify strongly with helping the people nearby if they feel a great deal of freedom and control of their own lives (i.e. if they have strong feelings of individual agency).


Does an identification with helping the people nearby have a positive effect on the social fabric or, to use an Australian expression, is it just about ‘looking after your mates’? In some contexts, helping the people nearby could even be corrupt behaviour. Fortunately, it is possible to test the relationship between identifying with helping the people nearby and attitudes toward corruption using data from the World Values Survey. This survey asks respondents to rate their view on whether it is ‘justifiable for a person to accept a bribe’ on a scale from 1 to 10, where a rating of 1 means that it is never justifiable and a rating of 10 means that it is always justifiable. (As before, I am basing my analysis on cross-tabulations for about 80,000 respondents in 57 countries from the 2005 Survey.)

The relationship between identifying with helping the people nearby and attitudes toward corruption is shown in the chart below. (The percentages shown in the chart add to 100 per cent along the horizontal axis.)

It is clear from the chart that people who identify with helping the people nearby have less tolerant attitudes toward corruption. Similar analyses show that these people are also less tolerant of social security and tax fraud, and fare evasion on public transport. It seems clear that the social fabic is stronger when a high proportion of the population identify with the importance of helping the people nearby.

Do you have to be a goody-goody to identify strongly with helping others?

No! People who feel a great deal of freedom and control of their own lives identify strongly with helping others even if they don’t see themselves as goody-goodies. People with strong feelings of individual agency identify strongly with the proposition ‘it is important to help the people nearby’ even if they don’t identify at all with the proposition ‘it is important to always behave properly’.


Before I present a chart showing this, I should provide some background information. I ended my last post wondering whether people who feel little freedom in their own lives might tend to be more likely to engage in anti-social activities if they give high priority to having a good time and feel little control over their own lives. However, when I looked at World Values Survey data on people who identify strongly with the proposition ‘it is important to this person to have a good time’ I found that they tend to identify much more strongly than average with helping others, even when they feel little control over their own lives. (I am basing these observations on cross-tabulations for about 80,000 respondents in 57 countries from the 2005 Survey.)

So, I decided to see if this is also true of people who identify strongly with the proposition ‘it is important for this person to be rich’. It is. It is also true of people who identify strongly with ‘being very successful’, ‘thinking up new ideas and being creative’, ‘being adventurous and taking risks’, ‘looking after the environment’, ‘living in secure surroundings’, ‘tradition’ and ‘always behaving properly’. It seems that people who identify strongly with just about any proposition about the importance of a particular value in their own lives tend to identify strongly with helping others, even when they feel little control over their own lives.

It is hardly surprising that people who identify strongly with the proposition ‘it is important to this person to always behave properly’ would identify with helping others. What about those who see themselves as being a bit naughty – the people who say that proposition ‘is not like me, or not at all like me’? I gave the answer in the first paragraph. It is also shown in the chart below.

I’m not sure of the implications of the finding that people who do not see themselves as giving importance to behaving properly tend nevertheless to identify strongly with helping others if they have strong feelings of personal agency. Perhaps feelings of personal freedom and control of their lives help individuals to behave responsibly even when they prefer to see themselves as being fallible rather than virtuous. This deserves further study.

How much do we know about the relationship between freedom and human flourishing?

I have been thinking about this subject for a long time. I have blogging about various aspects of it for more than 3 years and I have just written a conference paper entitled ‘Some Observations on the Relationship between Freedom and Well-Being’. Yet I still don’t feel as though I know enough about the relationship between freedom and individual flourishing.


My interest in this topic stemmed partly from the questioning by some influential people of the economist’s traditional assumption that adult individuals of sound mind are the best judges of their own interests. There seems to have been an increasing tendency to question whether people make good use of opportunities available to maintain or improve their well-being and that of their families. There seems to be increasing support for paternalistic restrictions on freedom in an effort to discourage behaviour that is harmful to health (e.g. smoking) and financial well-being (e.g. gambling).

A priori reasoning can take us some distance in establishing the importance of self-direction and autonomy to human flourishing. As discussed in the paper referred to above, a strong case can be made that humans are creatures that cannot fully flourish unless they are responsible for the way they live their lives. Respect for individual autonomy also provides the basis for social cooperation. It is difficult to help other people to flourish – or even to live in peace with them – if we do not respect their autonomy.

Empirical analysis of the relationships between various aspects of freedom and dimensions of well-being also suggest a positive relationship between freedom and well-being. At a subjective level, feelings of individual agency – feelings about the amount of freedom and control that people have over the way their lives turn out – are closely related to life satisfaction. There is evidence that feelings of individual agency are influenced by institutions relating to democracy, freedom of expression and economic freedom. There is also evidence of a positive relationship between economic freedom and various subjective and objective measures of well-being.

The paper also looks at evidence on the question of whether strong feelings of individual agency are associated with more selfish behaviour. It concludes that, if anything, the opposite seems to be the case.

So, we have strong grounds to argue that self-direction and autonomy are important and that people do tend, in general, to make good use of the opportunities available to improve their well-being and that of their families.

Why do we need to know more than that about the relationship between freedom and flourishing?

One important reason has to do with way many of us tend to respond to the fact that some people use the opportunities available to them in ways that are harmful to their own well-being or that of other people. We often have tendency to support policy responses that seek to reduce temptations of vulnerable people, by restricting freedom, rather than to consider why such people have become vulnerable and how they might be helped to resist temptations. (I use the words ‘us’ and ‘we’ in this context because of my previous support for policies that I thought would reduce availability of harmful drugs when my children were in their teens.) I think that we tend to resort too readily to paternalistic interventions that attempt to remove temptations because we don’t know enough about what makes people vulnerable to temptations or how their vulnerability is affected by the institutional environment.

I think we also need a better understanding of the causes of anti-social activities, such as those associated with binge drinking, if we are to avoid attempts to deal with such problems without further restricting the liberty of innocent people. It might be helpful to know, for example, to what extent people behave irresponsibly because of the feeling that nothing they do has much effect on the way their lives turn out, in combination with of the priority they give to having a good time. It might also be useful to know whether such feelings and attitudes are more prevalent in some countries than others and, if so, why.

Postscript 1
I am intending to add postscripts to keep track of findings of additional research on this topic.

I now reject the hypothesis implicit in the last paragraph above. When I looked (here) at World Values Survey data on people who identify strongly with the proposition ‘it is important to this person to have a good time’ I found that they tend to identify much more strongly than average with helping others, even when they feel little control over their own lives. It seems that people who identify strongly with just about any proposition about the importance of a particular value in their own lives tend to identify strongly with helping others, even when they feel little control over their own lives.

As noted above, strong feelings of individual agency tend not to be associated with selfish behaviour. Further research (reported in the post linked above) suggests that people who have strong feelings of individual agency tend to identify strongly with the proposition ‘it is important to help the people nearby’, even if they don’t identify at all with the proposition ‘it is important to always behave properly’.

Does identification with helping the people nearby have a positive effect on the social fabric? Findings reported in another post suggest that people who identify with helping the people nearby have less tolerant attitudes toward corruption, are also less tolerant of social security and tax fraud, and fare evasion on public transport.

Where to from here? The general question I want to explore further is whether feelings of agency interact with various beliefs and values in ways that might help to explain self-destructive and anti-social behaviours. For example, do people with low feelings of agency generally tend to have more cynical attitudes toward factors leading to wealth and success in life and is this associated with different attitudes toward helping others, corruption and desirable child qualities?

Postscript 2
I have discussed the question of whether attitudes towards success, wealth accumulation and competition are  linked to feelings of individual agency in this post.

Why do some people use the opportunities available to them in ways that are harmful to their own well-being or that of other people? In my view view the best place to look for an answer is in terms of their sense of identity and the satisfaction they obtain from acting in accordance with their sense of identity. Various posts with the 'Identity' label are relevant in this context.

From a public policy perspective it is important to ask how government actions are likely to impact on an individual's sense of identity. For example, are they likely to encourage the individuals to perceive themselves as productive members of society.

From the perspective of individual self-improvement it is relevant for everyone to ask themselves what kind of person they want to be. Steven Stosny has an interesting post on this topic on the Psychology Today blog.