A Different Rationale for Redistribution: Pursuit of Happiness in the European Union

This paper explores the importance of the determinants of happiness when assessing the case for international redistribution. It presents a different rationale for international redistribution with reference to the impact that absolute levels of income and relative levels of income exert on happiness. The case for redistribution is so strong that it exists even when citizens are envious of one another and malevolent toward one another. The importance of these two determinants of happiness is explored when assessing the case for redistribution between member states of the European Union. An analysis of the importance of these determinants in the European Union reveals that there is significant scope for further redistribution to increase happiness. An index of happiness is constructed and simulations are presented to shed insight into the role that governments might play in the pursuit of happiness.