My main reason for even picking up the book was to see how Layard explains the problems of measuring and making interpersonal comparisons of happiness. How does he do it? Cleverly, he avoids the issue by clouding the chapter with many different examples of ways to measure happiness in individuals and aggregates ("countries"). Then he moves right on with the book and that's where the whole thing falls to pieces (at least for me). Surely, if you can't even measure and compare individual happiness, you can't go on to prescribe public policy on the basis of increasing societal happiness.
If you're interested, I suspect you can glean the juicy details of his book from this lecture, upon which the book is based.