The Origins of Happiness

Health of Mind and Body

The relationships discussed so far are all cross- sectional.

They thus include the effect of ongoing differences between

people as well as of year- by- year variations in human experi-

ence. This gives a broad picture of the full variety of human

experience. But, as accounts of the causal effect of specific fac-

tors, these estimates are vulnerable to the omission of import-

ant unmeasured differences between people. A panel analy-

sis, using a fixed effect for each individual, is less vulnerable

to this difficulty. As online Table A6.3 shows, the coefficients

measured with individual fixed effects are closer to zero than

those in the cross- section, but a part of this may be a failure to

allow for longer- term influences on life- satisfaction.^14

Mental versus Physical Health: The QALY Issue

As is well known, health- care spending in every country is

heavily weighted toward physical health. While Britain spends

more on mental health than most countries, it still amounts

to only 13% of total health- care spending.^15 This partly re-

flects of course the greater costs of much physical health care

and its importance in preserving life. But it partly reflects an

Table 6.3. How life- satisfaction is affected by adult outcomes

(cross- section) (β- coefficients)

USA Australia Britain BCS Britain BHPS

Income (log) 0.16 (.00) 0.09 (.01) 0.08 (.01) 0.09 (.01)

Unemployed −0.05 (.00) −0.04 (.01) −0.03 (.01) −0.06 (.00)

Physical illness −0.05 (.00) −0.17 (.01)* −0.06 (.01) −0.11 (.01)

Mental illness −0.21 (.00) −0.18 (.01) −0.11 (.01) −0.32 (.00)*