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How to make yourself happier during the pandemic

Summary:
There is plenty of relevant psychological advice, here is some more narrowly economic advice from my latest Bloomberg column.  Start with this key point: …it is a common result in empirical economics that consumption habits are slow to adjust to changing circumstances, especially unprecedented circumstances. It is not enough for you to develop new spending habits — you should double down on them. And this: Savings have been so high in part because people are hoarding resources for an uncertain future. But a lot of the explanation, especially for those with higher incomes, is that planned expenditures became impossible, dangerous or inconvenient. Instead of flying to Paris and staying at a hotel on the Seine, they drove to a cabin in Maine or West Virginia. Or maybe they postponed that

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There is plenty of relevant psychological advice, here is some more narrowly economic advice from my latest Bloomberg column.  Start with this key point:

…it is a common result in empirical economics that consumption habits are slow to adjust to changing circumstances, especially unprecedented circumstances. It is not enough for you to develop new spending habits — you should double down on them.

And this:

Savings have been so high in part because people are hoarding resources for an uncertain future. But a lot of the explanation, especially for those with higher incomes, is that planned expenditures became impossible, dangerous or inconvenient. Instead of flying to Paris and staying at a hotel on the Seine, they drove to a cabin in Maine or West Virginia. Or maybe they postponed that purchase of a new car or spent less time browsing in a bookstore. In any case, the end result is less spending and more savings, whether conscious or not.

Those may well have been prudent decisions. Still, many of us are not spending enough money having fun. We have been too slow to develop new, Covid-compatible interests.

Furthermore, likely you are underinvesting in driving to go see people, again due to the sluggishness of habit adjustment.  In most parts of America, traffic remains somewhat lower than before, and your human contact is likely lower than before.  Go and have lunch with them outside before the weather gets too cold!

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The post How to make yourself happier during the pandemic appeared first on Marginal REVOLUTION.

Tyler Cowen
Tyler Cowen is an American economist, academic, and writer. He occupies the Holbert C. Harris Chair of economics as a professor at George Mason University and is co-author, with Alex Tabarrok, of the popular economics blog Marginal Revolution. Cowen and Tabarrok have also ventured into online education by starting Marginal Revolution University. He currently writes the "Economic Scene" column for the New York Times, and he also writes for such publications as The New Republic, the Wall Street Journal, Forbes, Newsweek, and the Wilson Quarterly.

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