Founders Pledge recently published a report recommending Action for Happiness, a UK-based charity that aims to improve people's subjective well-being and to help people live happy and fulfilling lives. There are two reasons members of the Effective Altruism community might find this report especially interesting:
- We believe that Action for Happiness presents an unusually cost-effective giving opportunity for a charity that operates in high-income countries, comparable to StrongMinds, our mental health recommendation.
- We carried out a Bayesian analysis to estimate the effectiveness of Action for Happiness's intervention. This was our first attempt at evaluating a funding opportunity using formal Bayesian analysis, so it can no doubt be improved going forwards. However, it offers a concrete example of applying Bayesian inference to cost-effectiveness evaluation.
Below is the executive summary. The full report can be found here.
1. Money, health, and subjective well-being
Almost everyone cares about experiencing positive well-being: to be happy and satisfied with life, and free from negative emotions and depression. Often, when we try to improve the world, we try to increase people’s economic status or their health, but it is often unclear how well these things translate into subjective well-being.
For instance, as Figure 1 shows, increasing income only has a weak effect on increasing subjective well-being.1 Here, household income on the x-axis is shown on a logarithmic scale: the gap between $1,000 and $2,000 is the same as the gap between $32,000 and $64,000. The data suggest that income has a rapidly declining effect on subjective well-being the richer you get: increasing your income from $1,000 to $2,000 has roughly the same effect as increasing your income from $32,000 to $64,000. There is evidence that the effect declines to zero once equivalised household income reaches around $95,000.2
Figure 1: Self-reported life satisfaction and self-reported annual household Income.
Source: “Money Can Buy Happiness, Money Can Buy Happiness,” The Economist, accessed January 27, 2020, https://www.economist.com/graphic-detail/2013/05/02/money-can-buy-happiness.
There is also evidence that health problems have a much smaller effect on subjective well-being than one might imagine.3
2. The case for focusing on subjective well-being
Because income fails to track subjective well-being accurately in some cases, it is important to look outside the typical realm of economic analysis when identifying the best opportunities for improving people’s lives. By failing to consider subjective well-being directly, it is possible that many philanthropists and governments miss out on some outstanding opportunities to do good.
Over the last year, the Founders Pledge research team has explored ways to increase subjective well-being directly. During the course of this research, we came across the charity Action for Happiness. Their programme seemed promising in improving participants’ subjective well-being, and their scale-up seemed like a highly leveraged funding opportunity. This prompted us to carry out a more in-depth evaluation, resulting in our recommendation and this report. We plan to expand our work on how best to improve subjective well-being in the future.
3. Charity recommendation: Action for Happiness
Action for Happiness (AfH) is a UK-based charity that brings people together in small, face-to-face groups to explore what really matters for a happy and meaningful life. AfH is trying to build a community of people transforming their own lives to be happier and to help those around them. AfH provides 8-week courses, called Exploring What Matters (EWM), run by volunteers in their local community. The course aims to help people to tune in to what really matters for a happy and meaningful life, connect with others in meaningful face-to-face conversations, and to take action to boost happiness for participants and for others. Most courses to date have taken place in the UK, but courses have also been run in 20 countries around the world, including the US, Australia, Germany and Italy.
AfH is planning a five-fold scale-up over the next three years. In 2018, AfH provided 108 courses for a total of 1,537 attendees, and provided 148 courses for 2,198 attendees in 2019. The scale-up aims to reach 600 courses for 10,200 attendees per year from 2023 onwards, with a projected cost of £1 million ($1.3 million). The majority of scale-up funding would be spent hiring additional staff to facilitate the scale-up.
On average, interventions in high-income countries are less cost-effective than interventions in low- and middle-income countries. This is because high-income countries have more resources to spend on improving lives than low- and middle-income countries, so many of the best opportunities have already been taken. In part as a consequence of this, people in high-income countries also tend to be happier and healthier, so it is more difficult to improve their lives. However, we believe that facilitating AfH’s scale-up is an unusually cost-effective donation opportunity for a high-income country intervention. This is because (i) participants make voluntary donations, which are estimated to provide more than 50% of revenue after scale-up and (ii) AfH generates revenue from some of its other activities, such as its educational services and events. As a result, donations are not used to directly pay for EWM courses but rather cover the scale-up costs that would enable AfH to sustainably reach far more people through EWM courses.
What do they do? Action for Happiness helps people to live a happy and meaningful life, predominantly through its 8-week Exploring What Matters course, which is run by volunteers in their local communities. Action for Happiness is seeking funding to scale-up to reach 5 times more people through the EWM course and to run sustainably at this larger scale.
Is there evidence the intervention works? The main evidence for the efficacy of the Exploring What Matters course comes from a recent randomised controlled trial (RCT) of the programme. We also considered data routinely collected by AfH to measure the effect of the course, as well as less direct evidence, in the form of another RCT of a similar course designed to improve subjective well-being.
Is the intervention cost-effective? We estimated the cost-effectiveness of Action for Happiness in terms of reduction in depression and gains in happiness and life satisfaction. Reductions in depression are given in terms of DALY-equivalents averted and years of severe major depressive disorder prevented. DALYs measure the burden of disease by accounting for the premature death (mortality) that it causes and for the years lived with illness (morbidity) it causes: a DALY burden can stem from premature death or from short-term or long-term ill health. The disability weights of different diseases range from 0 to 1 (no disability to 100% disabled). One DALY can be thought of as one lost year of healthy life.
Happiness and life satisfaction points are measured on a 0-10 scale. One happiness point year gain is one year of life with an additional happiness point on the 0-10 scale. Life satisfaction point year gains can be understood similarly.
We estimated cost-effectiveness as follows:
What are the wider benefits? The Exploring What Matters course also improves other subjective well-being measures, such as compassion, worthwhileness and anxiety, and increases in self-reported measures of social trust and pro-social behaviour. By running these courses and other related activities, Action for Happiness is building a movement for happiness and prosociality, the benefits of which could be large but are not taken into account in our cost-effectiveness model.
Is it a strong organisation? Action for Happiness has a good track record and takes a keen interest in measuring its effects on participants through a recent RCT and ongoing measurements of its effects on course participants. The organisation has been transparent in its communication with us.
Is there room for funding? Action for Happiness is seeking £1 million ($1.3 million) over the next three years to facilitate its scale-up.
1. Stevenson, Betsey, and Justin Wolfers. ‘Subjective Well-Being and Income: Is There Any Evidence of Satiation?’ American Economic Review 103, no. 3 (May 2013): 598–604. https://doi.org/10.1257/aer.103.3.598
2. Jebb, Andrew T., Louis Tay, Ed Diener, and Shigehiro Oishi. ‘Happiness, Income Satiation and Turning Points around the World’. Nature Human Behaviour 2, no. 1 (January 2018): 33–38. https://doi.org/10.1038/s41562-017-0277-0.
3. Dolan, Paul, and Daniel Kahneman. ‘Interpretations Of Utility And Their Implications For The Valuation Of Health*’. The Economic Journal 118, no. 525 (2008): 215–34. https://doi.org/10.1111/j.1468-0297.2007.02110.x.