Wednesday, June 09, 2004

"Money, Sex and Happiness"

A brief discussion of the Blanchflower-Oswald NBER paper on "Money, Sex and Happiness" has been the WSJ's most downloaded for over a day. As far, as I can tell, the NY Times has not given it any coverage -- and if it had, would the sober Times readers have made it the #1 downloaded? (To be fair, last Sunday's NY Times reported on a survey by Men's Car magazine that concluded, "Porsche drivers get less action of a non-automotive kind than the drivers of VWs, BMWs, or even Volvos.")

Who says that contemporary economists overlook life's big questions? Blanchflower-Oswald process data from the National Opinion Research Center's General Social Surveys and find that (according to the WSJ piece), "going from having sex once a month to having it at least weekly is roughly equivalent to the amount of happiness an extra $50,000 of income would bring the average American. 'The effect of sex on happiness is statistically well-determined ... and large,' the authors conclude. 'This is true for males and females, and for those under and over the age of 40.'"

All of this goes to researchers' discussions of Revealed Preference vs Stated Preference as a good source of consumer information. The former is the traditional study of actual purchases; the latter is based on interview data -- and has been criticized as being less credible.

Consider that, at the margin, the study's findings imply that an extra episode is worth $1,300 - $1,400.