The relationship between development and happiness in the context of behavioral economics: The USA case

Neoclassical economists have subtracted the benefit of an individual's goods and services from his preferences and behavior as a result of his decisions.This approach is based on the extent to which individual benefit or well-being meets the individual's preferences.The choices that individuals make with the assumption that they have rational, complete information and try to maximize the benefit are the choices that maximize the expected benefit by definition. Economists and psychologists, however, have turned to the fact that preferences are often not a very good guide to the well-being associated with the results of choices, and to alternative ways of thinking about the benefit and measuring the benefit. The opinion that individuals are limited rational is explained by the behavioral economy approach, which suggests that individuals do not have full knowledge of their decisions and preferences and that social, emotional and mental factors are also effective. In this study, the relationship between some macroeconomic indicators considered as the level of development as social benefit and individual well-being determinants and happiness is discussed in the context of behavioral economics. The US example discussed in the study covers the years 1970-2020. The relationship between the per capita GDP, unemployment rate and the Gini coefficient used in the measurement of income distribution and the happiness index, which is an indicator of development, was analyzed. Firstly, Lee-Strazicich unit root test was used to determine the stationarity of the variables with econometric analysis. Hatami-J Cointegration test was used to determine the cointegration relationship. Hatemi-J Bootstrap analysis was used to determine the causality relationship between the variables. According to the analysis findings, the variables were made stationary by taking the difference and it was determined that there was a long-term cointegration relationship between the variables. According to the Khatami-J Bootstrap causality analysis, no causality relationship was found between the variables. However, as a result of the causality analysis according to time, the causality relationship between the variables was determined. It was concluded that there is a causal relationship between happiness and macroeconomic variables periodically.