Daniel Finkelstein
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To mark the first anniversary of Paddington Bear residing with the Browns, a small party is held at which Paddington performs conjuring tricks. Carefully reading from his conjuring book, the bear places Mr Curry's watch inside a handkerchief and smashes it with a hammer.
Unfortunately, Paddington has turned two pages at once. They were stuck together with marmalade. So he misses the words that follow the advice to bring down the hammer on the handkerchief - “having first removed the watch”.
I have been patient. For my entire adult life, I have been looking out to see Paddington's trick performed for real. But now I have. As my mother always told me: “Everything comes to he who waits.”
The production of literature about happiness has become an industry. Earlier this week a cross-party group of Christian MPs produced a report on the topic and were able to begin with a long list of books on the subject published in the last two years. Perhaps the most successful are Happiness: Lessons from a New Science by Richard Layard and Affluenza by Oliver James but there has been a host of others.
The starting point for this work is something called the Easterlin Paradox. In a 1974 paper, the economist Richard Easterlin presented empirical evidence on income and happiness that was pretty puzzling. Using surveys of how happy people say that they are, the paper seemed to show that within countries, the richer people are, the happier they are, but that between countries the same didn't hold.
What this suggests is that being relatively rich compared to your fellow countrymen makes you happier, but that your absolute wealth doesn't matter. Once a minimum income level is reached, an amount necessary for a country's residents to subsist, all that extra economic growth doesn't appear to be improving life satisfaction.
The implications of Easterlin's discovery are pretty strong. It suggests that all this consumption is doing us no good. That is what the Christian MPs suggest, questioning whether we haven't sacrificed family life on the altar of capitalism. Indeed, some authors go farther and suggest that the very act of shopping is actually making us unhappy. The Easterlin Paradox certainly means that we shouldn't be organising our economies to maximise economic growth. Happiness, not income, should be our guide.
The leading happiness authors suggest that we should concentrate on reducing inequality. This might lead to lower national income, but who cares about that? It isn't making us happier. Increased equality would stop us all worrying about our relative positions and thus remove a source of unhappiness.
And all this stuff has caught the mood. It's the intellectual vogue topic. David Cameron is talking about improving General Wellbeing not just Gross National Product. It's everywhere.
There is just one teeny, tiny problem. It seems as if Easterlin wasn't correct.
It appears that before picking up their hammers to smash down on the handkerchief of economic growth, the happiness authors had an accident with the marmalade. They turned over two sticky pages at once and missed the reassessment of Easterlin's work that has been taking place.
Easterlin's original paper was based on fairly limited data. Betsey Stevenson and Justin Wolfers, of the Wharton School, University of Pennsylvania, have been looking at the vast amount of data that has become available since then. And guess what? The two economists show that there is “a clear and positive link between average levels of subjective wellbeing across countries with no evidence of a satiation point beyond which wealthier countries have no further increases in subjective wellbeing”.
In other words they show that it's not just relative wealth that matters, it is absolute wealth too - on average, the richer you are, the happier you are. And this isn't true just for the first slug of income, just until we can subsist, it is true all the way up and as economies keep growing.
The Nobel prize-winning economist Daniel Kahneman is sufficiently important in this area of economics that Richard Layard dedicated his happiness book to him. Kahneman now believes the new evidence from the Wharton academics is “quite compelling” and adds that “there is just a vast amount of accumulating evidence that the Easterlin Paradox may not exist”.
Now this doesn't, of course, prove by itself that higher income causes greater happiness. Let's not make that mistake. In the academic literature on psychology you will find plenty of reason to believe, for instance, that the relationship might be the other way round - that greater happiness might cause higher income.
At the very least, however, it shows that higher income is consistent with greater happiness and isn't actually making us unhappy. It also means, again at the very least, that if the happiness authors want to advance the faintly counterintuitive idea that more income doesn't increase life satisfaction, they have a lot of work to do finding an entirely new way of making their point.
The Easterlin Paradox seemed to offer a way out for those unhappy with capitalism. After spending decades advancing methods of increasing growth that didn't work, much of the Left has moved on. Now they are arguing that growth doesn't matter or might actually be harmful. And the happiness literature helped make this point.
So what will happen now with these critics? Will they ignore the data? Will they walk away from the happiness idea and forget they ever mentioned it? Or will they turn their work on its head and use the new evidence to start arguing that capitalism might be the route to happiness after all?
I don't somehow think they'll choose this last option. Do you?
Daniel Finkelstein is a weekly columnist and Chief Leader Writer of The Times. His blog, Comment Central, is a personal round up of the best political opinion on the web. Before joining the paper in 2001, he was adviser to both Prime Minister John Major and Conservative leader William Hague
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Doesn't this have a lot to do with globalization of communication? Before about 1990 or so the non-western parts of the world had knowledge of their communities and countries only, and so they compared themselves to that standard. Now, they compare themselves to the whole world.
Erik, Seattle, USA
I think it was Sp[ike Milligan who said "money doesn't buy you happiness but it does buy a better class of misery".
Caroline Swift, Rochester, Kent
Alot of happiness comes from having more or being better than your peers. Most people's well being is defined by their feeling of self worth. Thats what evolution intended to motivate us to increase our lot.
People don't like this as it makes Utopia impossible and happiness a nil sum game
Mathew Davies, Cardiff,
Happiness is partly an attitude of mind. Many would think going for a walk in your local area boring, but my wife and I enjoy it, it helps our health, and it's free. Many places of interest, like museums, are free. Waiting instead of buying the latest gadgets can save you a fortune. And so on.
Barry, Wallington, UK
Humans are animals. As such the basic drive of the survival of the fittest applies to humans too. While for animals the competition might be food, or escaping from predators, for humans the competition is MONEY. As such no wonder more wealth relative to others makes you happier.
Andrew, Liverpool,
What is happiness? What EVERY one of these studies ignores is that what each individual describes as 'happiness' will differ not only from person to person, but even from time to time. Happiness is always a relative measure, not absolute, and as such unreliable for quantatitive evaluation.
Dominic Graham de Montrose, London,
considering how expensive this country is i would say that this article is more than spot on.
Alex, London, England
My brother in law has piles of it. He has been through two marriages so far.The first left because she felt neglected. The second left because she wanted his cash. Old fashioned blokes have got it all wrong. You can't throw money at it and expect her to care for the kids on her own. It no work matey
Boris, Belgravia, London
According to yet another survey, millions of us are so ashamed of being from the lower middle/working class that we're prepared to get into debt to show that we're 'posh'.
How sad that we put so much importance on money.
John, London,
maybe if the gov didn't tax so much there wouldn't be a mass exodus of native brits going abroad to live...just a suggestion.
Alex, London, England
Finkelstein got the proverb wrong! It is: "Wealth ALONE does make you happier". A big difference!
Sonja, Prague, Czech Republic
I'd volunteer, if someone wanted to research the effect of making me rich.
Graham Rounce, London, United Kingdom
Warning! This article doesn't do justice to Layard's brilliant book. The basis of his argument isn't Easterlin's argument. In fact, Layard looks at how although people in the UK are much wealthier today than they were in the 1950s, they're no happier for it.
More wealth hasn't made us happier!
David Haycock, Greenwich, United Kingdom
"Human beings are goal oriented."
That's quite the generalization, Richard. It's perhaps more accurate to say most people are reward oriented. We want what we want, and usually we'd rather not work at it.
Terrils, California, USA
More: Capitalist principles simply exploit our natural tendencies as a species. Redirect our acquisitive tendencies toward achievements that improve the world, make them every bit as measurable as a bank account, applauded by society, and accessible for all to compete, and you have a solution.
Stephen, Los Angeles,
Whoever says, or even thinks, that being rich is not better than being poor has never been poor.
Even Jesus, if the Gospels are to be believed had to fob his disciples of with a meaningless answer.: Matthew Ch19 v24 to 26.
Peter Bolt, Redditch, UK
Human beings are goal oriented. We thrive as a species because we are dissatisfied with the status quo and always look for the next thing. Replace material goals with worthy ones, art, medicine, family, make achievement measurable and valued by society, and we can be happy w/o destroying the planet
Stephen, Los Angeles,
I could have told them that all along.
Bob Hall, New York, United States
Money doesn't guarantee happiness; but it does enable one to be miserable in comfort.
Dunploddin, Malaga, Spain
It's not just the money - you need to understand how fortunate you are, and appreciate the value of money relative to the other things in life.
When skint I learned to appreciate my income. My budgeting skills mean I stretch very modest earnings to cover a lot more. I'm happy whatever I earn now
Donna, Middlesex,
Poor people have bills and struggle to pay them
Rich people have the same bills only larger.
I suppose one difference is a rich person can buy shares in his electric company and get a 60p dividend to use as seen fit
ie pay his bill with
But then a poor person can also
It is choice
Nicholas Iles, Oswestry, Shropshire
Money does not make you happy but it pays a lot of the bills that make you unhappy. The hierarchy of needs shows that satisfying the base needs is first. In order to become self actualized you have to make all sorts of payments, fiscal, physical and mental. Money helps to deal with the fiscal part.
PSF , london, uk
Money can't buy happiness. Neither can poverty. So would you rather be poor and unhappy? Or rich and unhappy?
As Ella FitzGerald said: "Honey, I been rich and I been poor. And rich is better."
Warren Buffett, world's 2nd richest, leaves everything to Bill Gates, the world's richest. Both happy.
David, Edison, USA
You bet I'd be happier.
Jane, Winchester,
Point taken: we shouldn't be chasing after things. But should we collect up all the things and redistribute them equally for maximum happiness? Um, I think that's been tried. It doesn't work.
Rick, Smithfield, RI, USA
Evidently the wealthy have better things to do than comment here.
Cal, Boise,
Most wealthy people don't enjoy their money. They work obsessively despite their wealth. It's the victory, the big deal, the success they crave. I would love to be rich, mostly because it would mean I could live a life of leisure without working. Which is why I'm unlikely to ever be wealthy.
Eric Richard, Tulsa, Oklahoma, USA
Although money doesn't buy you happiness, I would much rather be rich and miserable than poor and miserable
Alex, London,
When I was young and asked what I wanted to be when I grew up I always answered rich, to which I was told that money wouldn't bring me happiness or health.
Now I'm old and relatively poor I know I was right. How I'd love to end my days bemoaning my misery to my maid in a Swiss nursing home.
Patricia Thornton, Veliko Tarnovo, Bulgaria
Moneychangers and Temple? In the end, Jesus got thrown out.
michael murphy, brightlingsea, england
A wise old man told me one time
That happiness is nothing but a frame of mind
I hope when you go to measuring my success
That you dont count my money, count my happiness!
Lydiard, Swindon, England
Money can only enhance your happiness if the essentials are already there - good health, a loving relationship, true friends and a sense of purpose in your life.
Donatas, Vilnius , Lithuania
99% of life's problems can be solved with money, the other 1% is not worth solving.
ian cheese, london, UK
If one never acquires wealth, does that mean they are sentenced to a life of misery? If one is unable to change their circumstances, should they surrender? Are those who live a comfortable life more worthy? I believe we must find a way to make the most out of our own situation.
Bella, Golden, US
Having money allows you the luxury of not having to worry about money, that is all. If you have other issues they will still be there. However, if all you ever do is worry about having no money, getting some will mean you will of course be happier! Having money buys a better state of unhappiness!
Ken, Cheltenham, England
All emotions are a reaction to change, so if your wealth doesn't change you are neither happy or sad about it, Perhaps the researchers should look into volatility in economic wealth, rather than relative absolute levels.
Jason White, Paris,
Wealth , which is based on the concept of utility, takes its origin in the relation between the human being and the thing, while Happiness in the relation between one human being and another. It means, 4example, don't give toys to your children,just give them the happiness of a human relationship.
Ambra, Modena, Italy
It may be for capitalists that capitalism is the route to happiness, but ask the poor if it makes them happy. Ask the millions of people who are getting, by any standards, a raw deal from capitalism. Ask the people who are being made homeless because banks have been profligate in their lending.
Kevin Straw, Leicester,
I agree.
If i were rich, my wife would be happy...
and then i'd be allowed to be. :))
Jez W, Leeds,
Whoever says that money can't buy happiness is going to the wrong shops.
Steven, Liverpool, England
Being Happy and being wealthy are relative concepts and all depends on how one operationalises the same.somepeople can be happy when they meet their basics by having them above average, say you can afford to send your children to good schools and not average or very good.
Bob Kirenga, Hargeisa, Somaliland
I'd take all this research with a pinch of salt. The last I heard, studies were showing that wealth doesn't make you happier at all.
Measuring happiness is never going to be an exact science. Then you have a lot of confounding factors - for example, wealthy people have more stressful jobs.
Ed W, London,
poverty is no disgrace,but it's a great inconvenience.
Warren Buffett promises to donated a large part of asset to charity .He is doing that now even in the future. That proof he loves more people and would share with others. That is the profound essential meaning of money .
s leung, scotland, uk
When one has land, seed to grow one's own food and a roof over one's head that is good.
Who needs money?
Mrs Foster, PERTH, Scotland
Well, only a fool would ever trust a consultant who says: "Money makes you unhappy - give me yours and I'll prove it to you."
Tthe consultants will come presumably up with ever more baroque, expensive and fashionable therapies aimed at producing "balance" between wealth and happiness.
Ian Kemmish, Biggleswade, UK
Peace of mind and good health make you happy, and which indicate that I am right you can see a rich man with a lot of money but sick and worry . Beside that, helping the poor persons make you happy .So all the three mentioned above make you happy.!
Ahmed Aldawas
Kuwait
Ahmed Aldawas, Kuwait city, Kuwait
All four comment contributors before this one should have stayed in bed today. I don't think the author intended any in-depth analysis of the topic. Good grief. Lighten up!
Colin, Shaftesbury, UK
Wealth may or may not make you happy, but poverty is very likely to make you unhappy
John Ledbury, Kings Lynn, England
would that be the same Stevenson and Wolfers who state "By most objective measures the lives of women in the United States have improved over thepast 35 years, yet we show that measures of womens happinesshas declined both absolutely and relative to male happiness"?
more at work here than money
Adam Spray, Oxford,
Nobody with money can ever be happy for longer than it takes them to want more. It's called capitalism. Profit not happiness is the goal. Away with this soppy sentimentality.
Frosbert Eglantine, paris, France
One can be as wealthy as they like but without love will never be happy.
derek, east yorkshire,
Finkelstein seems to have forgotten the phrase 'ceteris paribus' i.e. other things remaining equal. If we are more stressed, have a worse natural environment, more family breakdown due to a culture of long and irregular hours of working, etc. etc. then of course the benefits of wealth will seep away
Robert C, London , UK
The author makes quite a lot of extrapolations from the (new) data. I don't quite see the relationship with capitalism. Are you trying to imply that amassing as much money as possible is a guaranteed route to happiness to subvert all others? My friends make me happy.
s.e. coyote, brooklyn, ny,
This lead is bewildering, alienating and has nothing to do with the headline. It requires an intimate knowledge of Paddington Bear. Who is Mr. Curry? Who are the Browns? And while we are on it, who cares what Mr Finkelstein's mum once told him.
chris, jakarta, indoensia
Not counter-intuitive at all
Up to a certain ('satisficing') level, the majority get happier, then ease up. But the driven keep driving on because they're unsatisfiable, so never happy
BUT their rewards continually make for more RELATIVE poverty for the majority, ever keeping them dissatisfied too
Lance, Bristol, UK
Clearly specific events afforded by increased wealth at any point in time could make one unhappier, but there is no reason why a general inverse connection might exist. However, over time, wealth and happiness can appear negatively correlated because of changes in other factors affecting happiness.
Billy Barnett, HK,
If an individual was once poor and is now rich, he may be happier than before. But it doesn't mean rich people in general are happier the poor. I have seen that people in poor countries look and sound much happier than those in the rich world, which is one of the reasons for their underdevelopment.
Yutaka Uno, Sao Paulo, Brazil