How to Optimize the Relationship Between Public Spending and Happiness

Abstract

Happiness and efficient public spending are considered to be two desirable goals. In this paper, I consider happiness in the sense of how much one likes the life one leads (Veenhoven, 1984), and emphasize negative utilitarianism (Popper, 1952) as the best approach for promoting happiness in public policies. An ethical framework about public policies implemented to improve social conditions for happiness is suggested. I give a definition of the term optimization and propose two methods to optimize the relationship between public spending and social conditions for happiness. I briefly introduce a bookkeeping method, and I then present the bases of an econometric method in which quantile regression is described as the best tool within the negative utilitarianist approach, because quantile regression makes possible to know which independent variables influence most the degree of happiness of the least happy/ the saddest. The bookkeeping and the econometric methods presented are useful for any local, regional, national or supranational authority. These methods may also be useful for optimizing the relationship between natural resources consumption and social conditions for happiness. The paper is a conceptual paper.