When wealth is the real happiness truth

Act always as if the future of the universe depended on what you did, while laughing at yourself for thinking that whatever you do makes any difference. — Buddhist saying

Pharrell William’s phenomenally successful song Happy wants us to “clap along” if we feel like “happiness is the truth”.

Economists say happiness can be found from making money, physiologist from a person’s sense of well-being. In 1974 the Easterlin paradox confirmed there  “was no link between income and happiness … beyond a certain point”.

So which philosophy is the truth?

Justin WolfersIt depends on who you talk to. This year US economists Justin Wolfers and Betsey Stevenson have taken Richard Easterlin’s theory to a new research level releasing findings that suggest there is indeed a relationship between income and happiness, for individuals and nations.

On leave from the University of Michigan and the Brookings Institution, Wolfers — better known as a 40-something surfing self-styled Aussie ex-gambler and current US import happiness guru – has been doing the media rounds talking up the findings of their joint paper Growth in Subjective Well-Being and Income over Time.

An abstract released by the National Bureau of Economic Research says Wolfers and Stevenson’s re-assessment of the Easterlin paradox has established a “clear positive link” between average levels of subjective well-being and GDP per capita across countries.

Their research found “no evidence” of a saturation point beyond which wealthier countries had no further increases in subjective well-being and that economic growth was associated with rising happiness.

Happiness-Hands1The findings will come as no surprise to those on struggle street. A widening gap between the haves and have-nots is a recurring theme throughout history and often linked to the cause behind civil unrest.

But on a very basic level, being unable to afford to pay your way in life is demoralising. It’s not about societies moving towards becoming welfare states but economies that can help all citizens contribute.

In a recent interview with Money, Wolfers responded to the question: Does money actually make you happier? “When I say rich people are happier than poor people, I don’t know if it’s the money that’s making them happy. When I say rich countries are happier than poor countries, I don’t know whether it’s the greater money that makes the average American happy or whether it’s the greater opportunities.”

For most people’s money, having access to opportunities is key to well-being, it’s akin to psychology theories about having “control in the workplace”. 

Both produce more productive people and the more productive employees are the more money they make for companies, and themselves. And don’t forget that old proverb money begets money, or in modern English “nothing succeeds like success”.

Wolfers seems to agree. He told Money his research looked at ­surveys, including the Gallup World Poll, of 155 countries covering 95 per cent of the world’s population and “it turns out that … as countries get richer, they get happier”.

Of course, it’s not going to come without effort. And while not everyone agrees you can put a dollar value on what makes one person happy compared with another, perhaps most of us can nod along with Aha CEO Brian de Haaff: “Whatever you value, you are rich if you have an abundance of it.”

Judy Wilkinson is a freelance writer and blogger is currently in Panama City in pursuit of happiness and money to make her world go round.

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