Chapter 16happiness varies less with income than with other key as-
pects of our external and internal life. On the external side,
the key aspect is the quality of our human relationships—
above all with family and loved ones, but also with our
colleagues and our boss, and in our local community. There
are many cost- effective ways in which the quality of those
relationships can be improved in our society.
At the same time the most important internal fact about
us is our health, and especially our mental health. Mental
health is the biggest single predictor of happiness. So we
need a much wider concept of deprivation. People are de-
prived if they cannot enjoy their life for whatever reason—
either external or internal to themselves. Fortunately we
now have extremely effective ways of treating mental health
problems, many of which save as much money as they cost.^1
In this chapter, we summarize our main findings on what
determines happiness. They are expressed in numerical form
because there is no way to compare the importance of dif-
ferent things except by using numbers. Our measure of hap-
piness throughout is life- satisfaction, measured on a scale of
0 to 10. So when for example we examine how unemploy-
ment affects happiness, we are asking how many “points” of
happiness are lost. The answer is 0.7 points. That is, like all
our estimates, an average effect across many people, some
of whom will suffer more and others less. But from a policy
point of view the average is a good place to start.
In a moment we shall describe how exactly we reach
our findings. But, before that, we can illustrate the massive
range of issues covered, with a few key findings about what
determines our happiness. These are explained more fully
in the rest of the chapter.