38-39 Protect Us from What We Buy: The dubious value of presents is found in Joel Waldfogel, “Does Consumer Irrationality Trump Consumer Sovereignty?,” Review of Economics and Statistics, Vol. 87, No. 4, 2005, pp. 691-696. Price fans will pay for basketball tickets from Ziv Carmon and Dan Ariely, “Focusing on the Forgone: How Value Can Appear So Different to Buyers and Sellers,” Journal of Consumer Research, Vol. 27, December 2000, pp. 360-370; and Drazen Prelec and Duncan Simester, “Always Leave Home Without It: A Further Investigation of the Credit Card Effect on Willingness to Pay,” Marketing Letters, Vol. 12, 2001, pp. 5-12. The story about the invention of ninety-nine-cent stores is in Tim Arango, “Bet Your Bottom Dollar on 99 Cents,” New York Times, February 8, 2009. Kahneman’s opinion on paternalistic interventions is found in Daniel Kahneman, “New Challenges to the Rationality Assumption,” Journal of Institutional and Theoretical Economics, Vol. 150, No. 1, 1994, pp. 18-36.
40-41 The Price of Life: The Jewish teachings are mentioned in Peter Singer, “Why We Must Ration Health Care,” New York Times Magazine, July 19, 2009. The various prices placed on life come from Chris Dockins, Kelly Maguire, Nathalie Simon, and Melonie Sullivan, “Value of Statistical Life Analysis and Environmental Policy,” White Paper for Presentation to Science Advisory Board—Environmental Economics Advisory Committee, U.S. Environmental Protection Agency, National Center for Environmental Economics, April 21, 2004; United Kingdom Department for Environmental, Food and Rural Affairs, “An Economic Analysis to Inform the Air Quality Strategy,” Updated Third Report of the Interdepartmental Group on Costs and Benefits, July 2007; Ramanan Laxminarayan, Eili Klein, Christopher Dye, Katherine Floyd, Sarah Darley, and Olusoji Adeyi, “Economic Benefit of Tuberculosis Control,” World Bank Policy Research Working Paper, 2007.
41-44 Paying for the Dead: Kenneth Feinberg’s experience at the helm of the September 11th Victim Compensation Fund comes from Kenneth Feinberg, “What Is Life Worth?,” Public Affairs, 2005; Frances Romero, “Kenneth Feinberg: Compensation Czar,” Time, June 10, 2009; Kenneth Feinberg, Camille Biros, Jordana Harris Feldman, Deborah E. Greenspan, and Jacqueline Zins, “Final Report of the Special Master for the September 11th Victim Compensation Fund of 2001,” Vol. 1, p. 98 (http://www.columbia.edu/cu/lweb/indiv/usgd/wtc.html#exec, accessed 08/08/2010); and Benjamin Weiser, “Value of Suing Over 9/11 Deaths Is Still Unsettled,” New York Times, March 13, 2009.
44-47 Valuing Citizens’ Safety: The cost-benefit analysis of flame-resistant mattresses is found in Consumer Product Safety Commission, “Final Rule: Standard for the Flammability (Open Flame) of Mattress Sets,” Federal Register, Vol. 71, No. 50, March 15, 2006, Rules and Regulations. The analysis of costs and benefits of seat belts in school buses is in William L. Hall, “Seat Belts on School Buses: A Review of Issues and Research,” paper for the North Carolina School Bus Safety Conference, February 29, 1996. Approaches to cost-benefit analysis by the Environmental Protection Agency and the Food and Drug Administration are discussed in Fred Kuchler and Elise Golan, “Assigning Values to Life. Comparing Methods for Valuing Health Risks,” USDA Agricultural Economic Report No. 784, November 1999. Costs and benefits of Homeland Security spending are discussed in Mark G. Stewart and John Mueller, “Assessing the Costs and Benefits of United States Homeland Security Spending,” University of Newcastle Center for Infrastructure Performance and Reliability Research Report, 2009; and Mark G. Stewart and John Mueller, “A Risk and Cost-Benefit Assessment of Australian Aviation Security,” Security Challenges, Vol. 4, No. 3, Spring 2008, pp. 45-61. The high cost of some government regulations in the United States is discussed in John F. Morrall III, “Saving Lives: A Review of the Record,” AEI-Brookings Joint Center for Regulatory Studies Working Paper, 2003; Government Accountability Office, “Superfund: Funding and Reported Costs of Enforcement and Administration Activities,” July 18, 2008; and W. Kip Viscusi and James Hamilton, “Cleaning Up Superfund,” Public Interest, Summer 1996. The costs and benefits of HO’s strategy to combat tuberculosis are laid out in Ramanan Laxminarayan, Eili Klein, Christopher Dye, Katherine Floyd, Sarah Darley, and Olusoji Adeyi, “Economic Benefit of Tuberculosis Control,” World Bank Policy Research Working Paper, 2007. The data on deaths from tuberculosis come from the United Nations Millennium Development Indicators’ data set.
48-51 Price Your Own Life: The value of life and the risk of dying in a car crash are discussed in “New Crash Tests Demonstrate the Influence of Vehicle Size and Weight on Safety in Crashes; Results Are Relevant to Fuel Economy Policies,” Insurance Institute for Highway Safety News Release, April 14, 2009; and Orley Ashenfelter and Michael Greenstone, “Using Mandated Speed Limits to Measure the Value of a Statistical Life,” NBER Working Paper, August 2002. Thomas Schelling’s proposal on valuing life is in Thomas Schelling, “The Life You Save May Be Your Own,” in S. B. Chase, ed., Problems in Public Expenditure and Analysis (Washington, D.C.: Brookings Institution, 1968), pp. 127-162. Bike helmets, cancer risks, and the value of life are discussed in W. Kip Viscusi and Joseph Aldy, “The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World,” Journal of Risk and Uncertainty, Vol. 27, No. 1, 2003, pp. 5-76. The United States Department of Agriculture’s evaluation of the cost of salmonella is in http://www.ers.usda.gov/data/foodborneillness/, accessed 08/13/2010). The value of health warnings on cigarette packs in Australia is in “Cost-Benefit Analysis of Proposed New Health Warnings on Tobacco Products,” Report Prepared for the Commonwealth Department of Health and Ageing, December 2003 (http://www.treasury.gov.au/contentitem.asp?ContentID=794&NavID, accessed on 08/08/2010).
51-54 Do We Know How Much We Are Worth?: The value of an old life versus a young life is debated in Cass Sunstein, “Lives, Life-Years and Willingness to Pay,” University of Chicago John M. Olin Law and Economics Program Working Paper, June 2003; Joseph Aldy and W. Kip Viscusi, “Age Differences in the Value of Statistical Life Revealed Preference Evidence,” Resources for the Future Discussion Paper, April 2007; and John Graham, “Benefit-Cost Methods and Lifesaving Rules,” Memorandum from the White House’s Office of Information and Regulatory Affairs to the President’s Management Council, May 2003. The comparison of the value of a life saved from terrorism with a life saved from a hurricane is in W. Kip Viscusi, “Valuing Risks of Death from Terrorism and Natural Disasters,” Vanderbilt University Law School, Law and Economics Working Paper, March 13, 2009. The assessment of the value of life for the rich and the poor, the white and the black is in Thomas Schelling, op. cit.; W. Kip Viscusi, “Racial Differences in Labor Market Values of a Statistical Life,” Harvard Law School Center for Law, Economics, and Business Discussion Paper (April 2003); James Hammitt and María Eugenia Ibarrarán, “The Economic Value of Reducing Fatal and Non-Fatal Occupational Risks in Mexico City Using Actuarial- and Perceived-Risk Estimates,” Health Economics, Vol. 15, No. 12, 2006, pp. 1329-1335; James Hammitt and Ying Zhou, “The Economic Value of Air-Pollution-Related Health Risks in China: A Contingent Valuation Study,” Environmental and Resource Economics, Vol. 33, No. 3, 2006, pp. 399-423; Cass Sunstein, “Are Poor People Worth Less Than Rich People? Disaggregating the Value of Statistical Lives,” University of Chicago, Olin Law and Economics Program Research Paper, February 2004. Data on deaths on the Titanic is in http://www.ithaca.edu/staff/jhenderson/titanic.html.
54-58 The Price of Health: Data on cervical cancer in Mexico is found in Cristina Gutiérrez-Delgado, Camilo Báez-Mendoza, Eduardo González-Pier, Alejandra Prieto de la Rosa, and Renee Witlen, “Relación costo-efectividad de las intervenciones preventivas contra el cáncer cervical en mujeres mexicanas,” Salud Pública Méx, Vol. 50, No. 2, 2008, pp. 107-118; Olga Georgina Martinez M., “Introducing New Health Commodities into National Programs: Mexico’s Experience with the HPV Vaccine,” Presentation at the Microbicide Access Forum, Mexico City, August 3, 2008; Liliana Alcántara and Thelma Gomez, “Papiloma, Vacuna de la Discordia,” El Universal, March 5, 2009. New Zealand’s policy on vaccines against pn
eumococcal disease is in Richard Milne, “Economic Evaluation of New Vaccines,” presentation at the New Zealand Immunization Advisory Centre Conference, Te Papa, September 15, 2007. World Health Organization guidelines on the affordability of medical treatment are from http://www.who.int/choice/costs/en/. The discussion about rationing treatment for renal cancer in Britain draws from NICE Technology Appraisal Guidance 169, “Sunitinib for the First-Line Treatment of Advanced and/or Metastatic Renal Cell Carcinoma,” March 2009; Kate Devlin, “Kidney Cancer Patients Should Get Sutent on the NHS, says NICE,” Daily Telegraph, February 4, 2009; Joseph J. Doyle Jr., “Health Insurance, Treatments and Outcomes: Using Auto Accidents as Health Shocks,” Review of Economics and Statistics, Vol. 87, No. 2, May 2005, pp. 256-270; Gardiner Harris, “British Balance Benefit vs. Cost of Latest Drugs,” New York Times, December 3, 2008. Health-care spending and health-care outcomes in the United States are discussed in Douglas Elmendorf, “Options for Controlling the Cost and Increasing the Efficiency of Health Care,” Congressional Budget Office Testimony Before the Subcommittee on Health, Committee on Energy and Commerce, U.S. House of Representatives, March 2009; Organisation for Economic Cooperation and Development, “Society at a Glance—OECD Social Indicators 2009” (www.oecd.org/els/social/indicators/SAG, accessed on 08/08/2010); Ryan D. Edwards and Shripad Tuljapurkar, “Inequality in Life Spans and a New Perspective on Mortality Convergence Across Industrialized Countries,” Population and Development Review, Vol. 34, No. 4, December 2006; OECD Factbook 2009; Congressional Budget Office, “Research on the Comparative Effectiveness of Medical Treatments: Issues and Options for an Expanded Federal Role,” December 2007.
59-64 The Price of Happiness: The impact of Los Ricos También Lloran is discussed in Sam Quiñones, “A Real-Life Soap Opera for Mexican TV Star: Network Dumps Queen of ‘Telenovelas,’ Latin America’s Best-Known Actress,” San Francisco Examiner, September 27, 1999; Sam Quiñones, True Tales from Another Mexico (Albuquerque: University of New Mexico Press, 2001); and Helen Womack, “Mexican Soap Washes Away Russian Woes,” Independent, September 8, 1992. Schopenhauer statement can be found in Arthur Schopenhauer, “Psychological Observations,” in The Essays of Arthur Schopenhauer (General Books LLC, 2010), p. 78. Bobby Kennedy’s speech can be found in the John F. Kennedy Presidential Library (at http://www.jfklibrary.org/Historical+Resources/Archives/Reference+Desk/Speeches/RFK/RFKSpeech68Mar18UKansas.htm, accessed 08/16/2010). The “Report by the Commission on the Measurement of Economic Performance and Social Progress,” by Joseph Stiglitz, Amartya Sen, and Jean-Paul Fitoussi for the French government can be found at www.stiglitz-sen-fitoussi.fr. The account of Bhutan’s gross national happiness draws from Seth Mydans, “Recalculating Happiness in a Himalayan Kingdom,” New York Times, May 7, 2009; the Center for Bhutan Studies (grossnationalhappiness. com/gnhIndex/intruductionGNH.aspx, accessed 08/12/2010); Swaminathan S. Anklesaria Aiyar, “Bhutan’s Happiness Is Large Dam, Fast GDP,” Times of India, November 1, 2009; and Ben Saul, “Cultural Nationalism, Self-Determination and Human Rights in Bhutan,” International Journal of Refugee Law, Vol. 12, No. 3, July 2000, pp. 321-353. Data on Bhutan and India’s GDP per person is drawn from International Monetary Fund statistics (www.imf.org/external/datamapper/index.php). Statistics on the impact of income on happiness come from Andrew Oswald and Nattavudh Powdthavee, “Does Happiness Adapt? A Longitudinal Study of Disability with Implications for Economists and Judges,” IZA Discussion Paper, July 2006; Paul Frijters, David W. Johnston, and Michael A. Shields, “Happiness Dynamics with Quarterly Life Event Data,” IZA Discussion Paper, July 2008; Gallup Organization, “About One in Six Americans Report History of Depression,” October 22, 2009 (www.gallup.com/poll/123821/One-Six-Americans-Report-History-Depression.aspx. , accessed 08/16/2010); Ronald Inglehart, Roberto Foa, Christopher Peterson, and Christian Welzel, “Development, Freedom and Rising Happiness, A Global Perspective (1981-2007),” Perspectives on Psychological Science, Vol. 3, No. 4, 2008, pp. 264-285; and Angus Deaton, “Income, Aging, Health and Wellbeing Around the World: Evidence from the Gallup World Poll,” Journal of Economic Perspectives, Vol. 22, No. 2, Spring 2008.
64-66 What Happiness Is: Examples of the link between happiness and other measures of well-being are in: David Blanchflower and Andrew Oswald, “Hypertension and Happiness Across Nations,” Journal of Health Economics, Elsevier, Vol. 27, No. 2, March 2008, pp. 218-233; Daniel Kahneman and Alan B. Krueger, “Developments in the Measurement of Subjective Well-Being,” Journal of Economic Perspectives, Vol. 20, No. 1, Winter 2006, pp. 3-24. Examples of the difficulty of defining happiness are found in Daniel Gilbert, Stumbling on Happiness (New York: Vintage Books, 2005); Norbert Schwarz and Fritz Strack, “Evaluating One’s Life: A Judgment Model of Subjective Well-Being,” in Fritz Strack, Michael Argyle, and Norbert Schwarz, eds., Subjective Well-Being, An Interdisciplinary Perspective (New York: Pergamon Press, 1991), p. 36. Sigmund Freud quote is from Sigmund Freud, Civilization and Its Discontents (New York: W. W. Norton, 2005), p. 52. The inconsistent choices of overweight Americans are found in Jeffrey M. Jones, “In U.S., More Would Like to Lose Weight Than Are Trying To,” Gallup, November 20, 2009 (www.gallup.com/poll/124448/in-u.s.-more-lose-weight-than-trying-to.aspx, accessed on 08/08/2010). Abraham Lincoln’s tale is in Ben Bernanke, “The Economics of Happiness,” Speech at the University of South Carolina Commencement Ceremony, May 8, 2010 (found at www.federalreserve.gov/newsevents/speech/bernanke20100508a.pdf, accessed 08/16/2010).
67-70 Happiness Is a Concrete Floor: The link between sex and happiness is described in David Blanchflower and Andrew Oswald, “Money, Sex and Happiness: An Empirical Study,” Scandinavian Journal of Economics, Vol. 106, No. 3, 2004, pp. 393-415. The data on happy Republicans comes from Paul Taylor, “Republicans: Still Happy Campers,” Pew Research Center, 2008; and Jaime Napier and John Jost, “Why Are Conservatives Happier Than Liberals?,” Psychological Science, Vol. 19, No. 6, June 2008, pp. 565-572. The data on happiness in East Germany are found in Paul Frijters, John Haisken-DeNew, and Michael Shields, “Money Does Matter! Evidence from Increasing Real Incomes and Life Satisfaction in East Germany Following Reunification,” American Economic Review, Vol. 94, No. 3, June 2004, pp. 730-740. The data on happiness in Russia come from Richard Easterlin, “Lost in Transition: Life Satisfaction on the Road to Capitalism,” SOEP Papers, DIW Berlin, the German Socio-Economic Panel (SOEP), April 2008; and Elizabeth Brainerd, “Economic Reform and Mortality in the Former Soviet Union: A Study of the Suicide Epidemic in the 1990s,” IZA Discussion Paper, January 2001. The story about the impact of a concrete floor on happiness in Mexico’s Coahuila state is in Matias Cattaneo, Sebastian Galiani, Paul Gertler, Sebastián Martínez, and Rocio Titiunik, “Housing Health and Happiness,” World Bank Policy Research Paper, April 2007. The data on happiness among the rich and the poor come from Rafael Di Tella and Robert MacCulloch, “Gross National Happiness as an Answer to the Easterlin Paradox?” Journal of Development Economics, Vol. 86, No. 2, April 2008, pp. 22-42. Robert Frank’s statement is in Robert Frank, “Does Absolute Income Matter?” in P. L. Porta and L. Bruni, eds., Economics and Happiness (New York : Oxford University Press, 2005), p. 67. The data on income and happiness in Brooklyn and San Jose, California, is found in Census Bureau, American Community Survey 2006-2008 estimates (factfinder.census.gov/servlet/DatasetMainPageServlet?_program=ACS&_submenuId=&_lang=en&_ts= , accessed on 08/08/2010) and the Gallup-Healthways Well-Being Index (at www.ahiphiwire.org/wellbeing/, accessed 08/16/2010).
70-72 The Treadmill of Happiness: How happiness adapts to positive and negative shocks is discussed in Andrew Oswald and Nattavudh Powdthavee, “Does Happiness Adapt? A Longitudinal Study of Disability with Implications for Economists and Judges,” Warwick University Working Paper, July 2006; Andrew E. Clark, Ed Diener, Yannis Georgellis, and Richard E. Lucas, “Lags and Leads in Life Satisfaction: A Test of the Baseline Hypothesis,” Economic Journal, Vol. 118, June 2008, pp. F222-F243. Richard Easterlin’s finding on Americ
ans’ stagnant happiness is in Richard Easterlin, “Does Economic Growth Improve the Human Lot? Some Empirical Evidence,” in Paul A. David and Melvin Reder, eds., Nations and Households in Economic Growth: Essays in Honor of Moses Abramowitz (New York: Academic Press, 1974), p. 89. The data on the impact on happiness of your neighbors’ wealth are in Erzo Luttmer, “Neighbors as Negatives: Relative Earnings and Well-Being,” Quarterly Journal of Economics, Vol. 120, No. 3, August 2005, pp. 963-1002; and Mary Daly and Dan Wilson, “Keeping Up with the Joneses and Staying Ahead of the Smiths: Evidence from Suicide Data,” Federal Reserve Bank of San Francisco Working Paper, April 2006. The thesis about how stagnant happiness may confer evolutionary advantages is in Luis Rayo and Gary Becker, “Evolutionary Efficiency and Happiness,” Journal of Political Economy, Vol. 115, No. 2, 2007. Adam Smith’s quote about happiness as deception is in Adam Smith, The Theory of Moral Sentiments, 11th edition (Edinburgh: printed for Cadell and Davies et al., 1812), p. 317. Easterlin’s views about the pointlessness of growth are in Richard Easterlin, “Feeding the Illusion of Growth and Happiness: A Reply to Hagerty and Venhoven,” Social Indicators Research, Vol. 74, No. 3, 2005, pp. 429-443.
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