is in itself an affective forecasting error since people often overestimate the impact of future losses. Happiness and well-being Economic definitions of happiness are tied to concepts of welfare and utility, and researchers are often interested in how to increase levels of happiness in the population. The economy has a major influence on the aid that is provided through welfare programs because it provides funding for such programs. Many welfare programs are focused on providing assistance with the attainment of basic necessities such as food and shelter. This may be due to the fact that happiness and well-being are best derived from personal perceptions of one's ability to provide these necessities. This statement is supported by research that states after basic needs have been met, income has less of an impact on perceptions of happiness. Additionally, the availability of such welfare programs can enable those that are less fortunate to have additional discretionary income. Discretionary income can be dedicated to enjoyable experiences, such as family outings, and in turn, provides an additional dimension to their feelings and experience of happiness. Affective forecasting provides a unique challenge to answering the question regarding the best method for increasing levels of happiness, and economists are split between offering more choices to maximize happiness, versus offering experiences that contain more objective or experienced utility. Experienced utility refers to how useful an experience is in its contribution to feelings of happiness and well-being. Experienced utility can refer to both material purchases and experiential purchases. Studies show that experiential purchases, such as a bag of chips, result in forecasts of higher levels of happiness than material purchases, such as the purchase of a pen. This prediction of happiness as a result of a purchase experience exemplifies affective forecasting. It is possible that an increase in choices, or means, of achieving desired levels of happiness will be predictive of increased levels of happiness. For example, if one is happy with their ability to provide themselves with both a choice of necessities and a choice of enjoyable experiences they are more likely to predict that they will be happier than if they were forced to choose between one or the other. Also, when people are able to reference multiple experiences that contribute to their feelings of happiness, more opportunities for comparison will lead to a forecast of more happiness. Under these circumstances, both the number of choices and