Is Reported Happiness Five Years Ago Comparable to Present Happiness? A Cautionary Note
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In the United States reported happiness five years ago is not comparable to present happiness. The improvement in happiness over the last five years obtained by differencing current reports of happiness today and happiness five years ago is not significantly related to the actual improvement in happiness over the same period. The currently reported five-year change in happiness is highly sensitive to current economic conditions, varying inversely with both the inflation and unemployment rates.
Ordinarily, happiness five years ago as currently reported is less than present happiness, but the worse the current economic conditions are, the better the past looks relative to the present. If current economic conditions get bad enough, past happiness will be rated higher than present. Reports of happiness five years ago are not telling us about the utility respondents actually experienced at that time; they are telling us, instead, about respondents' current decision utility–which situation, today's or that five years ago, they would opt for if given the choice today.
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