Economics of happiness

Good places make us smile

How we measure communities, or the way we define happiness or attachment, surprisingly doesn’t vary from city to city. In 2008, the Knight Foundation and Gallup teamed up to launch the “Soul of the Community” project, which examined citizen attachment in 26 communities across the country, including Fort Wayne. They sought to tease out why certain communities have residents who are enthusiastic about where they live and have a deep sense of pride, while others are fairly indifferent. Their research indicated three factors:

Social offerings: Places for people to meet and the feeling that people in the community care about one another.

Openness: How welcoming the community is to different types of people, including families with young children, minorities and talent.

Aesthetics: The physical beauty of the community including the availability of parks and green spaces.

Despite traditional variables such as jobs, economics and safety also being analyzed, these three factors appear to have more impact on our attachment to quality places. More importantly, research indicated cities with the highest levels of attachment also had the highest rates of local economic growth (gross domestic product). Suddenly, “happiness” was an economic term.

We are happier when we’re engaged. When we give something back to our communities (be it time, money or goodwill), we tend to have higher levels of personal well-being. So, while the measurement of social offerings, openness and aesthetics can be made, we also need to acknowledge our personal perceptions of these factors – a distinction that is critical for modern economic growth.

Happiness is perceived, as behavioral economist Daniel Kahneman says, in two very distinct ways – first is through experience (in the act of doing) and second through memory (through the act of remembering). For example, think of a family vacation. If you weren’t allowed to have any memory of your vacation once it was over, would it change where you were willing to go? Studies show many of us enjoy planning a vacation more than we do experiencing one. Our “experiencing self” and our “memory self” often have two very different definitions of happiness. We perceive communities the same way, even when it’s something as simple as walking down the street.

Have you ever noticed your willingness to walk further down “better” streets is much greater than down “bad” ones? While the physical experience (such as distance walked or quality of sidewalk) could be identical, the memory of the walk (meeting people, seeing a new restaurant) is dramatically different. This instinct to qualify places informs our decisions and shapes our everyday routine.

Good places make us smile. And when they do, we remember it.

First appeared in the August 2016 issue of Fort Wayne Magazine.


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