Does learning economics make you happy?
Economists, and those that have to bear with us, will agree that learning economics changes the way you look at the world. But will it make you happy?
For the sake of argument, forget the fact that economics degrees tend to make you rich, famous and popular with the sex of your preference. Forget that it can transform mere mortals to social analysis gods. Focusing purely on the ways in which learning economics alters the way you feel, should a rational, perfectly informed, utility-maximising individual choose to study economics?
Judging from my own experience, the answer is yes. Here's why:
For the sake of argument, forget the fact that economics degrees tend to make you rich, famous and popular with the sex of your preference. Forget that it can transform mere mortals to social analysis gods. Focusing purely on the ways in which learning economics alters the way you feel, should a rational, perfectly informed, utility-maximising individual choose to study economics?
Judging from my own experience, the answer is yes. Here's why:
1. I cherish my consumer surplus. I value most of the stuff I buy way more than what I have to pay for them; vanilla ice cream makes me happy beyond belief, and the same is true for the music of Dream Theater and the (soon to be purchased) Apple iphone. And what am I asked to pay for them? Peanuts.
2. I cherish my producer surplus. I am getting paid way, way more than the salary that would make me indifferent between supplying labour and staying at home.
3. I never have regrets: I did the best I could given the information available to me at the time. Judging I could have done better using information I acquired at a later date makes as much sense as regretting the existence of gravity. On a related topic, I understand the irrelevance of sunk costs.
4. While I do care for my welfare in relative terms, my welfare in absolute terms looms large in my utility function - and, boy, look how its value has been growing.
5. The selfishness of my fellow human beings does not make me anxious or depressed. Adam Smith (or was it Mandeville?) taught me that humans, selfish as they are, can make happy societies. And perhaps more to the point, they can make me happy.
On your point 2- isn't your producer surplus calculated with reference to your next must productive use, which surely isn't staying at home? I'm sure datacharmer could make a living as healthy living as a builder, in which case his producer surplus isn't as large as he claims.
Forgive my scepticism but Datacharmer making "a healthy living as a builder." - ?
Anonymous 1 - what you are referring to is the loss in my producer surplus if I lose my current job (this is often the focus of welfare analysis). Indeed, that won't entail such a massive change, as the second best job will only be marginally worse (and there's a stochastic element too, so who knows - I might even end up better off). I am referring to producer surplus in an absolute sense, not comparing two different situations: even if my only option was to work in the construction industry, my producer surplus would still be very large.