Research in Switzerland has indicated that Direct Democracy can contribute to happiness. The following lecture, by Nobel Laureate Daniel Kahneman, explores the notion of happiness in more detail, contrasting what we remember with what we experience and the difference between happiness and well being. Finally it briefly examines US poll data and the correlations between income and happiness. This shows that incomes above $60k don't add any more happiness, but incomes below $60k rapidly erode happiness.
Could it be that Direct or Interactive Democracy would naturally adjust policy to achieve the greatest total of happiness in society, given that the greatest number of citizens have lower wages and would benefit most from policies that improved their wealth while richer people may not gain happiness from greater wealth?
(This idea doesn't necessarily point towards wealth redistribution; it may just as easily point to wealth creation via capitalism. I note that Switzerland has the highest per capita income of any country in Europe.)