Bruno S. Frey is Permanent Visiting Professor at the University of Basel and Research Director at CREMA – Center for Research in Economics, Management and the Arts, Zurich. Before he was Professor at the Universities of Constance, Zurich, Chicago, Warwick and Friedrichshafen; he was awarded five Honorary Doctorates in five countries. Frey published 21 books and more than 600 articles in scholarly journals.

Acknowledgements 6
Contents 7
1 Happiness as a Goal of Human Beings 11
Concepts of Happiness 11
Happiness and Material Welfare 12
Literature 14
2 Happiness Can Be Measured 15
Various Kinds of Happiness 15
Measurement Methods 16
Surveys of Subjective Life Satisfaction 17
U-Index 19
Experience Sampling Method 19
Day Reconstruction Method 19
Brain Activity 20
Literature 21
3 What Makes People Happy? 22
Determinants of Happiness 22
Genetic Endowment 23
Economic Factors 23
Income 23
Work 24
Distribution of Income 25
Economic Development 25
Socio-Demographic Influences 26
Age 26
Family Status 26
Children 26
Social Relationships 27
Health 27
Education 27
Culture and Religion 27
Political Conditions 28
Democracy and Well-Being 28
Federalism 29
Literature 29
4 Consequences of Happiness 30
The Importance of Several Joint Influences 30
The Effects of Happiness 30
Causality 32
Literature 32
5 Psychological Influences on Happiness 33
Happiness Is Partly Self-constructed 33
Adaptation 33
Comparison with Other People and Situations 34
Cognitive Biases 34
Restricted Prognostic Abilities 34
Literature 35
6 Happiness Maximization by the Government 36
Should Politicians Maximize Happiness? 36
Biased Answers to Happiness Surveys 37
Manipulated Happiness Index 37
Literature 38
7 What Happiness Policy Is Appropriate? 39
Enabling Happiness 39
Happiness as Ultimate Goal? 39
Institutions Leading to Happiness 40
Happiness in the Current Politico-Economic Process 42
Job Market and Economic Growth 42
Income Inequality 43
Independence and Self-employment 44
Voluntary Work and Donations 44
Family and Social Relationships 44
Education 44
Liveable Cities 45
Literature 45
8 What About a Happiness Pill? 46
Happiness Pills Exist 46
A Thought Experiment 46
Positive Effects 47
Negative Effects 47
Substitutes and Complements 48
Procedural Benefits 48
The Paradox of Happiness 49
Selfish Governments 49
What Can Be Said? 50
Literature 51
9 Happiness and Consumption 52
Welfare Judgments 52
Limited Self-control and Individual Well-Being 52
Misprediction of Utility 53
Literature 54
10 Happiness and Television Viewing 55
An Important Consumption Activity 55
Effects of Television Watching on Happiness 56
Effects Differ Between Groups 57
Literature 58
11 Happiness and Management 59
Effects of Happiness on Business Activities 59
Instrumental Use of Happiness 60
Various Forms of Happiness 60
Offering Possibilities for Happiness 61
Literature 62
12 Happiness and Religion 63
Models of Religious Activity 63
Types of Religiosity 63
Internal Religiosity: Faith 64
External Religiosity: Attending Church Service 64
Denomination 65
Effect Size 65
Literature 66
13 Happiness and War 67
Fundamentals 67
The Well-Being Lost by the Dead 68
Disregarding the Well-Being of the Dead by Definition 69
The Case of Terrorism 70
Military Conflict May Raise Happiness 71
Psychological Costs of Military Combat 72
Concluding Remarks 73
Literature 74
14 Happiness in the Digital World 75
Internet Use 75
Literature 76
15 Beyond Material Aspects 77
Expected and Unexpected Insights 77
Literature 79