Tuesday, June 02, 2009

Happiness Facts

Justin Wolfers does a nice job summarizing his happiness papers with Betsy Stevenson in these posts: 1, 2, 3, 4, 5, 6.

They also have a paper on the trends in happiness inequality in the US which he summarizes here:
1, 2, 3

I do agree that money can buy some level of happiness. Obviously richer countries are happier than poorer countries because they have it easier. Rich people don't have to struggle as much. Having money allows you to buy the necessities(food, housing,clothing) and luxuries you may desire. But even so, being rich doesn't necessarily buy entire happiness. For instance, we see in the tabloids the life of celebrities (the rich and famous) that wind up overdosing in drugs, committing crimes. They seem to have this unfulfilled void, which is so sad to me because they seem to have it all. But maybe there is such a thing as having too much money.
Yesterday, I attended a presentation about the Kingdom of Bhutan and they have an interesting policy. Instead of setting their economic goal based on GDP, they set their goal based on GNH (Gross National Happiness). The notion itself intrigued me for a long time.

1. How can happiness be quantified? Many economist have tried so hard but yet, those indexes are not accurate as they measure the relative happiness of people, not how happy they are?
2. Is it possible for that idea to be implemented in the United States, where money rules?

Anyway, this is the link for the nytimes article on Bhutan:

The idea that money can buy happiness is an idea that I most definitely agree with to a very high degree, especially when it comes purely to higher wages. When someone has higher wages they obviously can opt out of work more often to obtain more leisure time which is in many people’s mind a very important aspect of life, which make many people very happy. Along with the idea of having more leisure time, if you do not have excess money what would someone do with their leisure time, just sit around, activities no matter how simple they are, cost some amount money. Vacations, going to the movies, going out to dinner, and even driving up to the mountain to for a hike costs some amount of money. Beyond money bringing forth happiness on an individual level, when a society is richer there are more activities and experiences to be had, which I believe leads to people in that society being happier. As well as their being more leisure activities, the government of that society will be able to provide more for the people within that society and people will be less stressed about the basic essential that people need to live. And beyond everything else I do not believe that there is such a thing as to much money, the example given of how the lottery winner over spent and lost his fortune because they didn’t not know how to manage their money is an outlier in this type of study and should not even be given, beyond that that example does not have much to do with how money makes people happy, but how unintelligent people do not know how to properly manage their assets.
I agree with Karina. Money can only buy so much happiness, after a certain point, you get bored with it. It supplies the necessary happiness in providing food, shelter, clothing and extra-curricular activities such as paying for a vacation, a new car, a pool, etc. and eventually you've been to every country, you have 30 cars and 2 pools so now what do you do with all of that money. On the other hand, if you dont have enough money to pay the bills and buy food, I can see how having more money would buy happiness as it could lead to a less stressful life...I don't know if it would work in a country the size of the U.S. but I think that the Kingdom of Bhutan may be on a good track.
One trend that I noticed while looking at the graphs on happiness was how high happiness used to be and how much it has fallen till today's point. This leads me to believe that yes we are happier then we were, but that we are not as happy as we once was. Since the graphs show a steady decline in the level of happiness, and, then more recently, an increase in happiness levels, I draw a different conclusion. With the economy in its worst state in our lives, the Iraq War, and the collapse of Wall Street, perhaps people are not actually more happier. Instead, people are actually settling for the way things are, and have decided that this is the way things will be.
Money definitely solves a lot of problems and issues in life. If you are incredibly was wealthy, not only are you capable of buying necessities needed in life, you can also buy any luxuries desired. Some believe that having so much money can get boring. I believe otherwise. Even if you have been to every country and have purchased all the cars you want, you can always use the money in other ways. You could give your money to charities and to other causes. Thus, I believe that money can make a person happy whether it is indirectly or directly.
Happiness cannot be bought entirely with money. Dont get me wrong though, money can buy you things that make you happy like cars, boats, houses etc.. But money means nothing if you do not have people who love you, or family or friends. Its those things in life that help dictate how happy a person will be. You could have all the money in the world but if you have no friends or family to share your life with, I gurantee you would be one lonely sad person.
I think that the amount of money someone has and the happiness one attains from it depends entirely on the person and their situation. Another couple hundred dollars means something a lot different to a single working mother living in poverty trying to support her children than it does to a king or multimillionaire. Sadly enough, sometimes these families who don't have as much turn out happier than these people with lots of money because they cherish every extra cent they have to take of the things that are important, such as family and friends while some rich people will just blow all of their money on material things because they are getting bored or lonely
I don't believe money actually buys happiness. Money buys opportunities and experiences that can lead to happiness. The other weekend I was at a race at Laguna Seca, a place I've been many times as just a general admission fan. However, this most recent time, my dad and I got the VIP treatment since my brother-in-law's company sponsors the team. I had a blast at the race and got to talk to the crew and drivers and eat at the hospitality tent. The extra money this weekend cost didn't buy extra happiness, since I always enjoy the races there. The money bought a different experience which lead to a different happiness.
I don't think that money can buy happeniness. Money can make you to have happeniness such as go to Disneyland and buy a lot of things you want. Money can buy a lot of things and solve a lot of issues in the society. I believe that rich countries have higher happeniness than poor countries. However, I didn;t say that eveyone who is rich are happy. It's depend on many factors. Maybe the person don;t know how to enjoy life and make money all the time.
I don't believe one can compare happiness levels between rich and poor countries because different cultures have different perceptions on what happiness is. That's why some poor South American countries rate higher than the U.S. As far as money and happiness is concerned obviously money can't buy happiness, obviously health is important, and obviously having strong, interpersonal, meaningful relationships bring happiness. Referring to Outliers, I think there is a threshold on the amount of money that makes one happy. Below that level, how can you be happy if you're worrying about food and rent? Above that and how much more does having that extra million dollars make you happy?
The issue of money "buying" happiness can only truly be addressed with quantitative methods. While the idea of "happiness" is clearly a qualitative or subjective one, we need to use concrete numbers to measure it. One can belabor the idea of money's affect on happiness with subjective and arguable discussions, but such is little use in economics. Since money is a quantifiable figure, we should use concrete numbers to decipher its effects on happiness. The following logical question is: which figures can we use to measure happiness? This is of course another subjective question. Life expectancy, literacy rates, infant mortality rates, education rates, et al can are often used in conjunction with each other in a composite figure to attempt to measure common factors which produce happiness. Obviously this entire issue is subjective, but to address the question in a valuable economic manner, it is helpful to assign quantifiable information to the variables.
Money (for myself at least) could most defiantly "buy" happiness. I judge my happiness level by what do I have to think about that makes me not happy in my life.....well thinking about all the money necessary to complete school, pay rent, secure a decent future, and secure financial security for my family certainly weighs on my mind constantly reducing the number of happy thoughts allowed to my head.
I can't really agree that money can only buy so much...I have never met anyone or personally had the opportunity to buy as much as I could in attempt to increase my happiness level.
I agree happiness can be purchased with money, but only in the assumption with certain level. You can buy car, buy house or any other thing to make you happy. However, certain happiness is priceless. For instance you can buy the joy from becoming a dad. Or you can't buy happiness when you finished your finals. But nevertheless, I do believe the value of happiness which purcahsed by money can be extend to many levels. For instance, you can buy a car to make you feel happy. But further, you use that car to attract a woman's attention who wanna talk to you. That's a happiness too. However, like I said before, money can't buy every kinds of happiness.

I believe it’s not possible to make a general statement on whether money makes people more or less happy. Money comes with a whole set of new elements that may have good or bad impact on our happiness, and depending on how susceptible we are to every one of them, the conclusion will go one way or the other (i.e. different from person to person).

I recently made an effort to provide a more comprehensive picture of what these ad- and disadvantages are. I invite you to have a look at http://www.spreadinghappiness.org/2009/08/money-how-much-should-we-strive-for-it-to-become-happy/ and tell me what you think!

Thank you,

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