Why could, according to you, the Happy Prince not see the misery of the people when he was alive? What does it show about his character?

He could not see the misery of the people because he was always kept inside the palace and was covered from the outside world where these miseries lie,  that's why he couldn't see the true world and misery of the people beyond its palace walls.
After we further read the story we come to know that he is actually a man with good character and a good heart who wants to remove the misery of the poor people but is unable to so, then the bird comes and the prince agrees to sacrifice even his eyes at the end to help the poor people. This shows us that the happy prince had a very good character and he was a caring and loving person too.
 

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