Happiness Has Nothing to Do with Money
Posted on June 30th, 2006Smiles are free.
A very interesting paper has just been published by Princeton researchers. The paper, titled Would You Be Happier If You Were Richer? A Focusing Illusion explores the relationship between money (how rich you are) and happiness. The abstract reads like a wise father talking to his son:
The belief that high income is associated with good mood is widespread but mostly illusory. People with above-average income are relatively satisfied with their lives but are barely happier than others in moment-to-moment experience, tend to be more tense, and do not spend more time in particularly enjoyable activities. Moreover, the effect of income on life satisfaction seems to be transient. We argue that people exaggerate the contribution of income to happiness because they focus, in part, on conventional achievements when evaluating their life or the lives of others.
In 2004, the researchers developed a tool to measure people's quality of daily life known as the Day Reconstruction Method (DRM), which creates an "enjoyment scale" by requiring people to record the previous day's activities in a short diary form and describe their feelings about the experiences. Surveying 909 employed Texas women, their experiment extended previous studies in which people have exhibited a "focusing illusion" when asked about certain factors contributing to their happiness – attributing a greater importance to that factor once it has been brought to mind.
The women were asked to report the percentage of time they spent in a bad mood the previous day, they were asked to predict how much time people with certain income levels spend in a bad mood. Survey respondents expected women who earned less than $20,000 a year to spend 32 percent more of their time in a bad mood than they expected people who earned more than $100,000 a year to spend in a bad mood. In actuality, respondents who earned less than $20,000 a year reported spending only 12 percent more of their time in a bad mood than those who earned more than $100,000. So the effect of income on mood was vastly exaggerated.
To provide further evidence on the role that income plays in people's lives, the researchers conducted an additional DRM survey in 2005. Respondents reported their experiences from moment to moment as well as their annual household income and overall life satisfaction. The new survey found that income was more weakly correlated with individuals' happiness from moment to moment than it was with their overall life satisfaction.
Finally, the researchers examined data from a nationwide Bureau of Labor Statistics survey on how people with varying household income levels spend their time. These data show that people with higher incomes devote relatively more of their time to work, shopping, childcare and other 'obligatory' activities. Women surveyed by the researchers in Ohio associated those activities with "higher tension and stress." People with higher incomes spend less time on 'passive leisure' activities such as socializing or watching television, which the respondents viewed as more enjoyable.
So why study just women? It's a homogenous group, and so easier to statistically analyze. Current work is focusing on men and women from across the USA. The results of that should make for interesting reading!




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