Money Buys Happiness and You Can Never Have Too Much, New Research Says

[xchrom]

http://www.theatlantic.com/business/archive/2013/04/money-buys-happiness-and-you-can-never-have-too-much-new-research-says/275380/



Americans have a peculiar conviction that the one thing money can't give us is satisfaction. You can't buy happiness, we've all been told. "Mo Money Mo Problems", Biggie concurred. And while we can all agree that desperate poverty is hideous, there is a broadly held view that after a certain level of income (around $75,000, say), more money doesn't buy more well-being.

But it's just not so. Economists Betsey Stevenson and Justin Wolfers have been arguing for years that, yes, richer families tend to be happier, and no, there is not an automatic cut-off point. In other words: Mo money, fewer problems.

Their elegant and straightforward new paper can be nicely summed up in the two graphs below. The first graph looks at income groups within countries. In all nations surveyed, richer households reported more life satisfaction. (Statistical note: This graph is logarithmic. That means doubling your income from $1,000 to $2,000 raises satisfaction by the same amount as doubling your income from $10,000 to $20,000. You can imagine why this might make a good theoretical case for income redistribution.)



The next graph compares different countries, rather than different households within countries. Here, each circle represents a nation, with the richest ones clustered on the right. If extra income didn't matter for well-being, you'd expect the line to flatten. Instead, it steepens. More money doesn't just mean happier families. It means happier countries.

[siligut]

1. OK, but how about being too thin?

When will the study on that little gem come out?

[pinboy3niner]

4. You cannot be too thin, silly

All the ads I see tell me that.

[siligut]

6. After a certain age, weight loss comes from the face

It ain't pretty.

[pinboy3niner]

8. I think I need to work out

I've bren thin all my life, and now, "at a certain age," I'm turning into sticks and bones. Those with weight problems may hate me for it, but there it is.

[siligut]

9. A little extra weight helps if you get sick and can't eat

Then you have reserves and it may keep you out of the hospital. It is tougher to build muscle as we age though. If you are healthy at your current weight, don't sweat it, enjoy it.

[pinboy3niner]

11. Apparently from this study, all I need is extra money

[DetlefK]

2. link to paper, and maybe I found a flaw in their statistic method:

http://www.brookings.edu/~/media/research/files/papers/2013/04/subjective%20well%20being%20income/subjective%20well%20being%20income.pdf

Just skimming through it, but I found something fishy on page 4:
"We begin by evaluating whether countries at different levels of economic development have different average levels of subjective well-being."

Am I wrong or is there usually a bigger income-gap in poor countries? I'm thinking of corruption and exploitation here.
The income-gap leads to few rich people and many poor people.
Therefore poor countries have few happy people and many unhappy people.
Therefore the low average happiness of a poor country is not caused by income or GDP but by social injustice.

[Cal Carpenter]

7. Overall, this is not true

http://www.huffingtonpost.com/2011/05/23/10-countries-with-worst-income-inequality_n_865869.html#s282630&title=4_United_States

We are number 4 on this list, and while a few of the countries may be considered very poor on the list, it is mostly wealthier, western nations. Overall, there are certainly a lot of 3rd world countries with major wealth disparity, but that does not make the major western powers immune, or 'better', in this regard. So I don't think your theory is correct here.

I've seen other charts and lists about this and they are pretty consistent to the one I (sorta randomly from google) linked to here. Here's a few more...

http://www.oecd.org/els/soc/dividedwestandwhyinequalitykeepsrising.htm

http://money.cnn.com/2011/11/08/news/economy/global_income_inequality/index.htm

US income inequality has been growing and is very extreme at this time. As 'austerity' has been reigning all over Europe this is true in a lot of places you may not assume, like the UK.

[quaker bill]

3. I have never made a serious run at "too much"

So I cannot speak to that, but I can say that there is a threshold above which the lack of money ceases to be a issue that causes regular unhappiness. For me it was roughly when I reached 3x minimum wage quite some time ago. Being able to pay all the bills whenever they came in without having to check my account balances, and paying off all my credit card debt, were big factors. Having a small cushion for when my old cars need help... Being able to afford a modest domestic vacation...

I make more now, and I would say that our general happiness has increased a bit more, but really most of it came from crossing the threshold where the constant shortage of money ceased being an issue.

[pinboy3niner]

5. I'll bet that study is flawed in surveying friendship

Rich or poor, that's something you can never have too much of.

[hobbit709]

10. i've met a few people who had way more money than they needed.

They were not the happiest people around.
I'd say money buys happiness up to a point, then it doesn't anymore.
If you have enough money to not worry about the basics and to let you do some things like travel and enjoy things it does. When you have too much money, in most of the cases I've run across, it turns you into an asshole.

[Safetykitten]

12. And still people will say the old tired crap of the money and happiness thing...money deniers.