William Easterly has reviewed a recent volume of papers on the relationship between economic wellbeing and happiness. Better samples and other refinements have rocked the counterintuitive suggestion from previous research that getting richer does not make a person happier. Lefties love that idea because they can use it to rubbish economic progress and demand more transfers from rich to poor.
In a famous 1974 study by economic historian Richard Easterlin [not to be confused with Easterley] he found that within countries, rich people tended to be happier than the poor. But contrary to expectation, rich countries as a whole were not happier than poor countries. And even stranger, in the US, when per capita income rose sharply from 1946 to 1970, bliss did not rise alongside it.
Research using larger samples and more countries has pretty well reversed the so-called “Easterlin paraxox” in favour of the much more likely finding that happiness or at least “life satisfaction” follows the money.
The piece of the Easterlin paradox that really falls apart with newer data is his evidence that there was little diﬀerence between rich and poor countries on average happiness. Especially with the life satisfaction concept and a much larger sample, the diﬀerences are now recognised as vast, as shown in the chapter here by Ed Diener, Daniel Kahneman, and colleagues. As I heard a happiness researcher once state it most colourfully, the average Togolese man would be hospitalised for depression in Denmark. The non-paradoxical piece of the paradox remains as strong as it always was—within the same country, the richer are happier and more satisﬁed with their lives than the poor.