Fed Chair Ben Bernanke went back to his birth state to deliver the commencement address at the University of South Carolina this weekend.  And he tackled a topic that has become an increasingly popular area of study for economists (and sociologists, and political scientists, and legal scholars): happiness.  And while Bernanke hit on the basic truism that money can't buy happiness, he did connect a nation's happiness to some of the work of top financial policymakers, like himself:

This traditional economist’s perspective on happiness is not as narrow and Scrooge-y as you might think at first. If I were to ask you what you value in life besides goods and services--a nice car or house, for example--you might begin with, say, your health. Well, richer countries have more resources to devote to medical care, to good nutrition and sanitation, and to workplace safety, and for these and other reasons rich countries have higher life expectancies, lower infant mortality rates, and generally better health indicators than poor countries. Likewise, as the United States has grown richer over time, longevity and other measures of health have improved.

Another thing that most people value is a clean environment. Air and water quality are not included in the broadest measure of economic activity emphasized in government statistics, the gross domestic product (GDP), although some economists have worked on ways to do so. But again, rich countries have more resources to devote to maintaining a clean environment and do tend to have better air and water quality than poor and middle-income countries, notwithstanding the fact that rich countries by definition produce more goods and services. Rich countries also generally provide people more leisure time, less physically exhausting and more interesting work, higher education levels, greater ability to travel, and more funding for arts and culture. Again, these linkages, together with the benefits of enjoying a wide variety of goods and services, are the reason that economic policymakers--at the behest of the public--usually put heavy emphasis on job creation and growth. Along with price stability, maximum employment is one of the Congress’s two mandated objectives for the Federal Reserve. And, indeed, economists researching happiness and life satisfaction have found that both inflation and unemployment detract from happiness, consistent with the focus on these macroeconomic conditions in the mandate of the Federal Reserve.

You can read the full speech here. (H/t Barry Ritholtz)