What is the relationship between wealth and happiness? Do you think your personal level of happiness would be different if you had a significantly greater or smaller amount of money or if you were from a much poorer or richer country?

Question

What will be an ideal response?

Answer 1

One study found that in spite of a steady increase in inflation-adjusted income from 1957 to 2002 in the United States, happiness levels stayed the same. The author of the study reported with irony that now "we are twice as rich and no happier." A review of the results of the large number of studies on money and happiness suggests that if a person is living in poverty and his or her basic needs for food, shelter, and safety are not being met, then receiving more money to provide for these basic needs can make an upward difference in happiness levels. However, the hedonic treadmill starts to take effect as income rises above this basic level.

The wealth of the country the person lives in also seems to make a difference. As Diener et al. noted, "wealthy people are only somewhat happier than poor people in rich nations, whereas wealthy nations appear much happier than poor ones." So overall, the country's wealth seems to set the conditions that determine how much influence its residents' personal wealth has on happiness. In very poor nations, where poverty threatens life itself, being rich does predict greater well-being. In wealthier nations, however, where almost everyone has a basic safety net, increases in wealth have negligible effects on personal happiness. In the United States, the very poor are lower in happiness, but once a person is just barely comfortable, added money adds little to no happiness.