The happiness distribution: an exploratory analysis of eight European countries

Since the 1970s the Economics of Happiness literature has grown rapidly. Most of its focus has been on determinants of happiness, including relative and absolute incomes, inequality, social capital, and macroeconomic policies. However, the question of the distribution of happiness has also received some attention. In addition to developing appropriate measures of happiness, it is argued that understanding its distributional aspects is important to assist in developing holistic measures of well-being. A great deal remains to be studied in this domain, particularly in understanding happiness inequality both within and across societies. Predominantly, the application of cardinal variability measures to assess ordinal happiness scores has rendered problematic the conclusions of many prior empirical studies of happiness inequality. Allison and Foster (2004) recommend using a median-centred technique based on a ‘dominance approach’ to evaluate the distribution of categorical data. Dutta and Foster (2013) have recently applied this method to examine the distribution of happiness in the United States (U.S.) from 1972 to 2010. The current research takes the Dutta–Foster approach to an exploration of the distribution of happiness over the past four decades (i.e. 1975-2013) in eight European countries using the rich dataset provided in the Eurobarometer (European Commission, 2014). Complete and unambiguous rankings for happiness inequality and mean happiness are obtained using S-dominance and F-dominance criteria. Happiness inequality indices are estimated using the measures developed by Allison and Foster (2004) and Abul Naga and Yalchin (2008). Consistent with Dutta and Foster’s (2013) findings for the U.S., the dominance results obtained for European countries are robust to various scale and subjective weight transformations. Overall, in terms of average happiness, 1980s appears to be the decade with lowest mean happiness for majority of the countries in our sample, with happiness levels rising in recent decades. Moreover, for most countries, a period of rise in mean happiness seems to correspond with a decline in happiness inequality. Contrary to the materialistic and social comparison theories of happiness, which postulate a trade-off between the level and inequality of happiness, this finding indicates that an egalitarian policy targeted at reducing happiness disparities may in fact complement a utilitarian policy focused on enhancing mean happiness levels.