Does Money Buy Happiness?

Does Money Buy Happiness?

As nations become richer, they tend to become happier. But only up to a point. At a certain level of wealth—when our basic needs are met—people cease becoming happier overall. Money leads to happiness, but not always.

In happiness economics, this phenomenon is known as the Easterlin Paradox, which was first used to explain why Americans were not becoming happier in the 1970s, despite rising incomes. And you can see it at work around the world in a major new international survey.

The Pew Research Center interviewed people in 43 countries and found a strong correlation between increased wealth and reported happiness. Many emerging nations are a good deal happier now than they were seven years ago, when Pew last asked them. For example, life satisfaction in China, where GDP has increased by an average of 10% since 2007, grew by a whopping 26%. But then there’s little difference in life satisfaction in China and Germany, despite big differences in income per person. And rich countries like the U.S. and France have seen no difference since 2007. In fact, in several high wealth countries, the percentage of people reporting the highest levels of happiness (7, 8, 9 or 10 on a scale of 1 to 10) has actually declined slightly.  read the full article here