Abstract
Over recent years, academics and policy makers in several countries have been advocating for measures of utility and happiness to replace gross domestic product as indicators of development. Yet the notion of utility has a somewhat confused history, meaning different things to different people at different times. Hume, for instance, aligned utility with public usefulness, Bentham with hedonic feelings of pleasure and pain, and Mill and modern welfare economists with pretty much anything, and this confusion has not been absent from contemporary calls for utilitarianism to inform public policy design and intervention. A possible reason why there are many different meanings attached to the concept of utility is because many people, much of the time, are not driven to maximise utility at all, irrespective of how it is defined. That is, the pursuit of utility does not drive all desires, but rather desires are antecedent; in those circumstances, at most, some conception of utility is a possible consequence of achieving one’s desires. Desires are multifarious and vary across people. The policy maker’s role over the private realm of individual decision-making should not therefore be to strive to maximise utility, but rather to put in place conditions that facilitate people in the pursuit of their own conception of a desired life.
Highlights
Over recent years, there have been growing calls from some quarters to replace gross domestic product as an indicator of a country’s development with utility or happiness indices
Beyond a particular national income threshold, so the argument goes, increases in income appear to generate little if any additional aggregate utility, and public policy ought to focus more directly on improving the happiness of citizens
These apparent uncertainties regarding what exactly utility comprises are nothing new; I will argue in this article that the concept of utility, hereby treated interchangeably with welfare and happiness, has a long and confusing history in economic thought
Summary
There have been growing calls from some quarters to replace gross domestic product as an indicator of a country’s development with utility or happiness indices. Like utilitarianism and welfare economics, expected utility theory assumes that people ought to and, aside from making random errors, will maximise some notion of utility.
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