Being Too Rich Can Hurt Your Chances at Happiness
New research from psychologists at Purdue University and the University of Virginia shows that worldwide, money can buy happiness -- at least based on how people rate their lives and their emotional well-being. But there is a limit to the happiness that money can buy.
The study, based on Gallup World Poll surveys in 164 countries, shows that there is a "satiation point" at which higher household incomes don't generate any more happiness. These points vary depending on where people live, but globally, the researchers find that satiation occurs at $95,000 household income for life evaluations and $60,000 for positive emotions (happiness, enjoyment, smiling/laughing) and $75,000 for negative emotions (stress, worry, sadness).
These findings, published in January in Nature Human Behaviour, are based on interviews with more than 1.7 million adults aged 15 and older. The study's authors include Gallup Senior Scientist Ed Diener.
Building on research by Nobel Prize winners Angus Deaton and Daniel Kahneman on links between income and life evaluations in the U.S., the Purdue and Virginia researchers sought to discern whether happiness rises indefinitely with income, or whether there was a point at which higher incomes no longer lead to greater well-being. They also wanted to investigate how various factors such as world region, gender and education influence satiation effects.
Using data from the broader World Poll data set, they found that satiation happens worldwide, but it varies considerably depending on the type of subjective well-being (life evaluations or emotional well-being), world region and education level attained. For example, they found satiation occurs at higher income levels in wealthier nations.
They also found "turning points" in certain parts of the world, where if people made more money past the point of satiation, their life evaluations actually got worse. However, the Purdue and Virginia researchers suggest that the costs associated with higher incomes such as higher demands on time, heavier workloads and greater responsibility may be driving these reductions, rather than the high incomes themselves.
For more on their findings, read the full paper.