Last modified: 2018-06-23
Abstract
In 1974, the economist Richard Easterlin, within an empirical study, challenged the positive relation up to then accepted by economists, between income and individual happiness. This gave rise to the “Easterlin Paradox” and opened a field of research – the economics of happiness – that prompted some economists to explore new paths in order to offer an alternative approach to happiness to the one which has dominated in economics, at least since the “Marginalist revolution” in the 1870’s.
One of the most notable path consisted in providing a conception of the individual distinct from the isolated Homo oeconomicus usually associated to the latter, in order to explain the Easterlin Paradox: a conception which would be rooted in social and collective. This led to introduce social interactions into economic analysis, but in a way that seems a bit restrictive: an individual’s happiness would not depend on his/her absolute but on his/her relative situation, that is on comparisons that he/she makes between his/her own situation and the situation of a reference group. Social interactions are then restricted to comparisons – some would say “competition”- motivated by sentiment such as envy or jealousy.
In this paper, we would like to question the meaning and the role granted to social interactions in today’s economic analysis of happiness, by adopting an historical perspective. This led us to focus on two major figures to whom the economics of happiness often refers as forerunner: Adam Smith and Jeremy Bentham. Now, we will show that the interest of Smith’s analysis of happiness as well as Bentham’s one goes beyond the modern concepts that are attributed to them today, especially when this analysis concerns the influence of social interactions on happiness: for both authors, man is not an isolated individual, but someone whose happiness depends to a great extent on the others’ judgments (outside and within the economic sphere).
Our discussion will be organized as follow: in the first part of our paper, we are going to emphasize the relation that Smith and Bentham establishes between wealth and happiness. In a second part, we are going to highlight the specific influence that both authors grant to social interaction on happiness. This will allow us to discuss the mutual influence between Smith and Bentham but more generally their role in the history of the economic analysis of happiness.