Jun 15, 2013

money does increase life satisfaction, you sure?

Science is awesome process of repetitively challenging existing truth and finding new once , as we increase our knowledge we challenge old discoveries and come to new findings. 

Recently I published Is getting rich worth it?. In that I stated from my previous post that studies shows after $75,000 the happiness/satisfaction does not increase. Which was bit puzzling me...

So I dig deeper into this area and I found another (recent) study Subjective Well-Being and Income:Is There Any Evidence of Satiation?

This study challenges that old data.

Below graph shows in every country the life satisfaction grows as the income increases.





The Conclusions:
While the idea that there is some critical level of income beyond which income no longer impacts well-being is intuitively appealing, it is at odds with the data. As we have shown, there is no major well-being dataset that supports this commonly made claim. To be clear, our analysis in this paper has been confined to the sorts of evaluative measures of life satisfaction and happiness that have been the focus of proponents of the (modified) Easterlin hypothesis. In an interesting recent contribution, Kahneman and Deaton (2010) have shown that in the United States, people earning above $75,000 do not appear to enjoy either more positive affect nor less negative affect than those earning just below that. We are intrigued by these findings, although we conclude by noting that they are based on very different measures of well-being, and so they are not necessarily in tension with our results. Indeed, those authors also find no satiation point for evaluative measures of well-being.

I don't know if Income does or it does not increase satisfaction but this challenged my previous knowledge of money and happiness.

Some might say you don't live your life looking at numbers but human behavior studies amazes me, I love to explore "why we do what we do".