You’ve heard the axiom a thousand times: Money doesn’t buy happiness. Your parents told you this, and so did your priest. Still, if you’re like me, you would just as soon see for yourself if money buys happiness. People throughout history have insisted on striving to get ahead in spite of the well-worn axiom. America as a nation has struggled and striven all the way to the top of the world economic pyramid. Are we suffering from some sort of collective delusion, or is it possible that money truly does buy at least a certain amount of happiness?
Americans have on average gotten much richer over the past several decades than they were in previous generations. The inconvenient truth, however, is that there has been no meaningful rise in the average level of happiness.
In 1972, 30 percent of
Americans said they were very happy, and the average
American enjoyed about $25,000 (in today’s dollars) of our national income. By 2004, the percentage of very happy
Americans stayed virtually unchanged at 31 percent, while the share of national income skyrocketed to $38,000 (a 50 percent real increase in average income).
The story is the same in other developed countries. In Japan, real average income was six times higher in 1991 than it was in 1958. During the post–World War II period, Japan was transformed at unprecedented speed from a poor nation into one of the world’s richest countries. But the average happiness of a Japanese citizen, measured on a scale of 1–4, stayed exactly the same at 2.7.
In some countries, there is even some evidence that economic growth can create unhappiness. This is generally the case for nations experiencing rapid and chaotic development and thus opportunities for great wealth for the first time. Post-Soviet Russia is an example of this phenomenon. In the 1990s, after the fall of the Soviet Empire, a few entrepreneurs made vast fortunes in markets for oil and other primary resources. Yet post-Soviet Russia is a miserable place in which only about one in five citizens say they are very happy about their lives. Some development economists believe that cases of a few lucky entrepreneurs suddenly amassing large fortunes raised unreasonable expectations among ordinary Russians, creating a sense of extreme unfairness and leaving them deeply dissatisfied with their meager lot. And in this way, money created unhappiness. So individual countries don’t seem to get much happier as they get richer. But are rich countries happier than poor countries?
The answer to this question depends on how poor a “poor country” is. People in poor countries where much of the population lives below subsistence level are much unhappier than people in rich countries, on average. International comparative studies of happiness consistently place the poorest nations of the world—especially the countries of sub-Saharan Africa—at the very bottom.
In 2006, one study ranking countries in terms of happiness found that Zimbabwe and Burundi were the unhappiest places on earth. And this makes sense, of course: It is ridiculous to imagine that illiteracy, high child mortality, and the threat of starvation are any more pleasant or bearable to a Burundian than they would be to an
American. But once countries get past the prosperity level that solves large-scale health and nutrition problems, income disparity pales in comparison with other factors in predicting happiness, such as culture and faith.
For example, compare Mexico and France. The cost-of-living difference between the two nations is vast, so economists don’t compare raw income; rather, they compare the “purchasing power” of citizens. In Mexico—a nation in which most people live above the level of subsistence but still are much poorer than residents of the United States or Europe—the average purchasing power was about a third what it was in France in 2004. And yet Mexicans, in aggregate, are happier than the French. In Mexico, 63 percent of adults said they were very happy or completely happy. In France, only 35 percent gave one of these responses.
It might be tempting to dismiss the happiness of Mexicans as delusional or a reflection of the fact that most Mexicans have no idea what life with material wealth is like. But this would be a mistake: There is simply no evidence that Mexicans lack an understanding of true happiness compared to the French. A more reasonable conclusion is that Mexican happiness—and French unhappiness—are caused in large measure by forces other than money.
American communities are like countries when it comes to happiness. Like happy Mexico and unhappy France, the happiness of
American communities—all of which are above the level of subsistence—depends very little on their comparative prosperity. There are abundant examples of unhappy high-income communities and happy low-income communities. Take eastern Tennessee (which includes the cities of Chattanooga and Knoxville, but is mostly rural), where people are 25 percent likelier than people living in tony San Francisco to say they are very happy, despite earning a third less money on average. Obviously, it is more expensive to live in San Francisco than it is to live in Tennessee, but San Franciscans still enjoy more than 30 percent more disposable income.
Like nations and communities, as long as they don’t start out dangerously impoverished, individuals get little or no extra happiness as they get richer—even massively richer. In a classic 1978 study, two psychologists interviewed 22 major lottery winners and found that the joy of sudden wealth wore off in a few months. Further, lottery winners have a harder time than the rest of us enjoying life’s prosaic pleasures: watching television, shopping, talking with friends, and so forth. It’s as if the overwhelming experience of winning the lottery dulls the enjoyable flavors of ordinary life.
My eyes were opened with the sad tale of Mack Metcalf (which you can look up yourselves). In truth, it doesn’t necessarily destroy your life to win the lottery, as it evidently did his, but it won’t make your life better either.
So it’s true: Money doesn’t bring enduring happiness for countries, communities, or individuals, except perhaps when people start out in abject poverty. Why not? The answer has to do with what psychologists call “adaptation.” Humans tend to adapt psychologically to their circumstances—including their monetary circumstances—and do so very quickly.
http://www.american.com/archive/2008/may-june-magazine-contents/can-money-buy-happiness
