Year: 2006
Type: book-chapter
Abstract: Neoclassical economic theory rules out systematic errors in consumption choice. According to the basic view, individuals know what they choose. They are able to predict how much utility an activity or a good produces for them now and in the future and they can maximize their utility. This implies that behavior reveals consistent preferences. This approach makes it impossible to detect and understand sub-optimal consumption decisions, due to problems of self-control and thenmisprediction of utility. We propose the economics of happiness as a methodologicalnapproach to study these phenomena. Based on proxy measures for experiencednutility, it is, in principle, possible to directly address whether some observed behaviornis sub-optimal and is therefore reducing a person’s well-being. We discuss recent evidence on smoking and eating habits, TV viewing and commuting choice.
Source: edoc (University of Basel)
DOI: 10.5167/uzh-52224
Authors: Stutzer, Alois, Frey, Bruno S
Institutions: University of Basel, IZA - Institute of Labor Economics
Language: English
Subfield: General Decision Sciences
Field: Decision Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1523518249