Does Happiness Come With Wealth

               Happiness is a really hard thing to put your finger on. It is hard to say what exactly causes happiness because everybody gets happy for different reasons. The question I am trying to answer has been asked time and time again, does money buy happiness. This question is so frequently asked because our whole economy is set up with the assumption that more money is equivalent to more happiness. Research however has shown that this might actually not be entirely true.

Sometimes money brings more happiness than it does at other times. This is particularly true for money that you don’t have to work for. Studies show that when you either win or inherit a lot of money the amount of stress and unhappiness you have will go down. This study also states that the amount that their stress decreases and their happiness increases is directly dependent on how much money they win, the more they win the better they feel. After conducting these experiments and seeing how each time, each participant is happier once they win money, one might conclude that money does actually by happiness. This is actually the conclusion that that Jonathon Gardner comes to in his journal, “…reported happiness is positively correlated with income”. He does go on to say that more money will not necessarily lead to more happiness. So according to Mr. Gardner a certain amount of money is necessary in order to lead a relatively happy life, but once you have that much money adding more and more won’t necessarily make you happier at all. The experiments discussed in Gardner’s paper all support that a sudden “windfall”, that is something like winning the lottery, will actually increase the persons happiness in the years to come (Gardner, Jonathon).

The idea that a certain amount of money is needed in order to be happy, but more after that base amount won’t really effect much, is discussed in many other articles as well. This idea is that people need a basic amount of money in order to provide for their and their family’s needs. So that amount of money that they earn that allows them to do this makes them happy because they are using that money in order to take care of their loved ones. After that amount of money, however, many studies show that more money doesn’t make people happier. The difference being, that the money that they made was being used to take care of loved ones, but now that they are making extra money, that money is going to other, less satisfying things. Ed Diener and Robert Biswas-Diener talk about these studies and correlations between money and happiness. Their study shows that, “There are mostly small correlations between income and SWB (subjective well being) within nations, although these correlations appear to be larger in poor nations, and the risk of unhappiness is much higher for poor people.” (Diener, Biswas Diener)This basically proves everything that I just stated. Poor people and countries are more likely to be unhappy because they can’t afford to meet their basic needs, which is a travesty. However, once these basic needs are met the correlation between money and happiness pretty much drops off because now that the people’s basics needs are met, that extra amount of money isn’t really doing anything to proactively cause happiness.

This sort of break between money bringing happiness to a degree and then stopping once it gets to a certain point brings about the question of why. Why does this happen? When money buys us the things we need to support ourselves and our family it brings about happiness, but when we get more money and we are no longer spending it on just the essentials happiness doesn’t really increase. This sounds kind of backward. When the money we are making is used to take care of others we are happier and then when we have a surplus and can spend some of that money on ourselves, it no longer really changes our feeling. Scientists Dunn, Atkin, and Norton had an idea on the answer to this question. These scientists hypothesized that, “…how people spend their money may be at least as important as how much money they earn.” They then experimented with this idea and found that it is true at least to a degree, “. Providing converging evidence for this hypothesis, we found that spending more of one’s income on others predicted greater happiness both cross-sectionally (in a nationally representative survey study) and longitudinally (in a field study of windfall spending).” So according to both surveys and experiments that they conducted, although money itself may not buy happiness, when you spend money on other people it will bring you more happiness than if you were to have spent that money on yourself. This may not make sense to you because on the whole we see most people are selfish especially when it comes to money. But they tested it by giving participants of an experiment money and having the control group spend it on themselves, and the experimental group spend it on others. They saw that the experimental group reported greater happiness than the control group (Aknin, Dunn, Norton). Perhaps that is why the small amount of money earned in order to take care of someone’s family makes a person happier than spending excess money.

Okay, so if we explained why the money for basic needs makes people happy can we explain why excess money doesn’t increase happiness? We can certainly try. In my opinion, it all has to do with Julian House, and Stanford DeVoe’s research. They together questioned whether putting a price on one’s time inhibits our ability to be happy. Basically, because we all know we could be making a certain amount of money an hour we all are impatient and less happy because of it, “Experiment 1 demonstrated that thinking about one’s income as an hourly wage reduced the happiness that participants derived from leisure time on the internet” (DeVoe, House). I personally believe that this is why people’s happiness levels don’t just continue to rise with their incomes. As people get richer and richer, their time becomes worth more and more and time is a resource you can never get back. So Bill Gates messing around playing video games would probably have way less fun than you or I playing the same video games. Because in the back of his mind he is thinking about how much money he could be making instead of playing those video games. He is thinking about the opportunity cost of playing those games, and to him it is much larger than it is to people who are less rich, and therefore the game is not going to be as satisfying for him. Making more money is great, except when you think about your opportunity costs of doing other things instead of making that money.

Back to the main question of this whole thing, does more money mean more happiness? My answer to that is that is depends. There is definitely no guarantee that more money will make you more happy, however if you spend it right it just might. If you buy things for yourself with that extra money you might be happy for a little bit, but it is bound to go away relatively quickly. If you spend your extra money on others however, you will probably get a more lasting sense of happiness, well at least if you aren’t a terrible person. One thing is clear from all the research I did to write this essay, and that is that money does make people happier up to the point that they have their basic needs met.

 

 

 

 

 

 

 

 

 

Sources

Biswas-Diener, Ed Diener And Robert. WILL MONEY INCREASE SUBJECTIVE WELL-BEING? (n.d.): n. pag.   Kluwer Academic Publishers, 14 Sept. 2001. Web. 11 Nov. 2014.

Devoe, S. E., and J. House. Contents Lists Available at SciVerse ScienceDirect Journal of Experimental      Social Psychology (2011): n. pag. Journal of Experimental and Social Psychology. Web. 11 Nov.     2014

Dunn, E. W., L. B. Aknin, and M. I. Norton. “Spending Money on Others Promotes Happiness.” Science 319.5870 (2008): 1687-688. Web. 11 Nov. 2014.

Jonathan.gardner@warwick.ac.uk. Does Money Buy Happiness? A Longitudinal Study Using Data on          Windfalls (n.d.): n. pag. Web. 11 Nov. 14.