Does economic growth increase social welfare (happiness)? Answers to such questions can only be provided by a complete analysis of all the objective, subjective, and institutional effects. All measures originate from the subjective world, working through the institutional setting to affect the objective world, the institutional setting and/or the subjective world. Due to the increasing complexity of the modern society, it is likely that more problems are going to involve significant institutional and subjective effects, making a complete multidisciplinary study more necessary. As an introduction to this argument, the Harrod‐Hirsch concept of positional goods and its implications on the desirability of economic growth are analysed geometrically and extended. A simple method to reduce the difficulty of comparability in happiness surveys is also suggested.
Ng*, Y. K. (1978). Economic growth and social welfare: the need for a complete study of happiness. Kyklos, 31(4), 575-587.