När ekonomisk politik ska utformas anser nog många att det yttersta bedömningskriteriet är om den förmår skapa lycka. I den nya, preliminära studien ”Do Good Institutions Make Citizens Happy, or Do Happy Citizens Build Better Institutions?” undersöks om politik och institutioner som kännetecknas av en hög grad av ekonomisk frihet är relaterade till lycka samt, i så fall, hur kausaliteten ser ut:

First, the importance of economic freedom for life satisfaction is seemingly demonstrated by the use of ordinary least squares analysis. The Economic Freedom of the World Index by Gwartney et al (2010) is used as an index of economic institutions, since these have been shown to be of more overall importance for life satisfaction in previous studies. Results show that overall economic freedom is an important determinant of average national life satisfaction … It is also demonstrated that citizens do not equally value all elements of economic institutions, in terms of procedural utility. Areas 3, 4, and 5, which represent the free Access to sound money, Freedom to trade internationally, and freedom from Regulation of credit, labor, and business, are important determinants of life satisfaction, above the effects that these aspects of economic institutions might have on GDP per capita. Second, two stage least squares analysis is applied to investigate the relation of causality between economic institutions and life satisfaction. Legal origin is used to instrument for economic freedom, while an index for the rate of alcohol disorders and the per capita consumption of cigarettes is constructed to serve as an instrument for life satisfaction. The results indicate that economic freedom seems to raise life satisfaction, but life satisfaction has no effect on economic freedom.

Det är alltid svårt att fånga kausala effekter med imperfekta instrumentalvariabler, men resultaten indikerar i vilket fall att det är en stabil penningpolitik, frihandel och begränsade regleringar som bidrar till högre lycka.