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"The economics of happiness."

The study of economics is largely the study of human welfare.

By looking at life’s big issues – and the interactions that occur within diverse and, sometimes challenging, environments – economics can play a centre-stage role in analysing trends, preparing forecasts and shaping policies.

Dr Cahit Guven is a senior lecturer in the Department of Economics at  Deakin Business School and for the past eight years, he’s conducted research around the economics of wellbeing, family and health.

By using health and behavioural data, this dynamic and relatively-new field of research is playing a growing and credible role in how organisations manage priorities and governments shape policies.

‘I’m an econometrician so we look at statistical analysis using very large data sets (of more than a million people) to try and get an idea of the impact of issues, events and behaviours – such as how social capital affects happiness, the happiness difference between the couples, the connection between height and cognitive function or how children are affected later in life by man-made or natural disasters,’ he explains.

Working across a diverse range of projects, Dr Guven began studying the ‘economics of happiness’ while completing his PhD in the USA.

‘I wanted to do something different and there were only a couple of papers out about this topic.  I thought that, not only was it a field in which you could publish well, but it was one that a lot of people would be very interested in,’ he says.

Dr Guven’s PhD thesis – which was later cited in a report to the US Congress and The Wall Street Journal – looked at how happiness was impacted by a person’s financial savings and consumption pattern. It also explored how perception about others affected contentment.

‘When people compare themselves to their neighbours in terms of their consumption, it can make them very miserable,’ he observes.

In 2009, his work led him to Australia – and Deakin – where he continued to research issues around happiness, and mental and social wellbeing.

After studying economic and lifestyle satisfaction in Britain, Germany and Australia, he embarked on a ground-breaking research study that investigated the ‘happiness gap’ between couples.

With his co-authors, Dr Guven wanted to find out if the difference in happiness really mattered and if so, could it predict divorce.

Using data from the same three countries, this highly published – and publicised – research found that the risk of a break-up was greater when husbands were happier than their wives.

‘We found that women who initiated the divorce were actually less happy than their husbands, which is consistent with the idea that divorces are initiated by women. Not only because they are unhappy, but because they are unhappier than their husbands,’ he explains.

The factors that contributed to a widening of the ‘happiness gap’ included imbalanced domestic workloads and income levels, as well as disparity in social, cultural and religious backgrounds.

He says the research supports the view that for couples to maintain an enduring partnership, they need to be in the same ‘happiness tier’.

‘The results from this research are valuable for governments and organisations drafting policies that affect issues such as the division of household labour or income levels,’ he adds.

Around the theme of health and wellbeing, Dr Guven has also been researching how childhood determinants affect adult outcomes.

‘This started with some analysis between the relationship between height and cognition and IQ at older ages - which also fed into some dementia research,’ he explains.

Currently, he is investigating how the child survivors of man-made and natural disasters – such as flood, famine, earthquake and war – are affected in adulthood.

‘For instance, we are looking at a particular famine in Vietnam as well as the impacts of war in Vietnam and some other countries.  We’re trying to understand the early determinants of later life outcomes. This is important for public policy because investing in the nutrition and health of babies can affect education and employment outcomes in later life.’   

In disaster-prone regions, particularly across Asia, the research will not only look at the health and agricultural outcomes of affected communities but assist governments in planning contingencies for future events.

With Deakin colleague Dr Mehmet Ulubasoglu, Dr Guven also recently investigated the impact of the Gallipoli campaign on Turkish child survivors.

In a detailed analysis, the researchers found that beyond the frontlines, World War 1 severely impacted the generation of Turkish children born just before, and during, the Gallipoli battle.

Over a short period of time, the deaths of thousands of young men created a gulf in the labour market.  This resulted in many children – some as young as five – being pulled out of school to work in Turkey’s dominant agriculture sector.

Dr Guven says the research found that for every additional thousand soldiers who were killed from a province, the children who were born there (between 1911 – 1914) were up to 2.5 per cent more likely to be illiterate compared to the children born after 1916.

‘This is a significant number considering the literacy rate was 34 per cent across the 10 year period we investigated. Our figures suggest that the war was responsible for an important proportion of illiteracy for the cohort in question.’

Older children were even more severely impacted by the Gallipoli events; not only because of child labour but the resulting physical and emotional trauma he says.

‘A large number of children were either left as orphans or malnourished due to the absence of their household’s income-earning person. Also, the heavy consequences of the war resulted in mass psychological trauma for both adults and children. These factors meant that the socio-economic achievements of the cohort, who were aged under five in 1915, were likely to be restricted when they became adults.’

Dr Guven says that despite the current spotlight and significance that’s focused on Gallipoli, there has been little systematic enquiry into its consequences, and more importantly, the impact on Turkish civilians.

‘We felt that the story of Gallipoli was incomplete and one that needed to be told.’

Currently, Dr Guven is researching the impact of English-language proficiency on immigrants to Australia and says that, from an economics viewpoint, there is much to be done.

‘If a person has 100% better English proficiency his ratings are going to go up by this percent.  These are important because you can actually make decisions around policies and investment in adult education and its effectiveness.  From the point of doing some first- time benefit analysis for the policymakers, these estimates are very important.’ 

With his co-authors, Dr Guven has submitted seven projects for journal publication, and with others in the research pipeline, is continuing to focus on data that can impact policymakers.

‘It’s six years since I completed my PhD  so I feel that after publishing five years of happiness research I can explore other fields as well – that will hopefully make a difference to the welfare of future generations.’