Commentary

Money and Happiness Still Connected

By Will Wilkinson
This article appeared on Marketplace on March 12, 2008.

Everybody knows happiness can’t be bought. We all know a family short on cash but rich in love. And what good does a silk pillow case do you if you’re crying into it every night?

But that doesn’t mean wealth is irrelevant to happiness, does it? We all grasp the corrosive anxieties of poverty. Fretting over the rent, the next heating bill, a call from the collection agency: That’s a recipe for misery. Money matters, and we know it, which is why we give to those without enough.

It’s tempting to think that there’s is a point at which money no longer matters, but according to the latest research on happiness, there isn’t. Wealthier people tend to be happier. According to a 2006 Pew Research Center survey, Americans making over $100,000 a year were more than twice as a likely to say they are “very happy” than those making under $30,000.

And wealthier countries tend to be happier than less wealthy ones. Economist Angus Deaton has found evidence from a new Gallup World Poll that a doubling of per capita income does about as much for the happiness of a relatively rich country as it does for a relatively poor one.

Now, if you’re forced to choose between a rewarding job and a lot of money, choose the rewarding job. Happiness research doesn’t say you should aim to be wealthier. What it says is that, if you hold everything else constant — the richness of your relationships, the joy of your work — a little more money tends to makes us feel a little bit better.

But the corollary for politics is that economic growth and public happiness tend to move in the same direction. The political choice to put a brake on growth is not the social equivalent of choosing a lower-paying, but more meaningful job. It’s the choice to make tens of millions of people slightly less happy than they otherwise might have been.

Maybe something is worth that cost. I just can’t imagine what it might be.

Media Appearance Will Wilkinson discusses money and happiness on Marketplace. (March 12, 2008) [MP3]

Will Wilkinson is a research fellow at the Cato Institute.