Tag Archives: conceptualization

Untangling the effects of income on happiness

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Examining the relationship between income and happiness can be tricky. A recent research study, conducted by two Princeton researchers and summarized by LiveScience, is illustrative of some of the issues in this research field:

-The researchers were working with a large dataset that is built around a daily survey of Americans: “they analyzed more than 450,000 responses to the Gallup-Healthways Well-Being Index, a daily survey of 1,000 U.S. residents conducted by the Gallup Organization.”

-Changes in income were measured in terms of percentages rather than absolute numbers. This was done to reflect the fact that a percentage change in income would be better for comparisons across income types. As the researchers note: ““In the context of income, a $100 raise does not have the same significance for a financial services executive as for an individual earning the minimum wage, but a doubling of their respective incomes might have a similar impact on both.”

-Survey respondents answered questions related to two measures of happiness: overall life satisfaction and what their emotions were the day before. According to the LiveScience article: “For life evaluation, participants indicated on a scale from zero to 10, from worst to best possible, how they would rate their lives. For emotional well-being, participants answered yes/no questions about whether they had experienced various positive and negative emotions a lot during the prior day.” Having both of these dimensions is critical as a general question about happiness might be interpreted differently (do the reseachers mean happy right now or overall?) by respondents.

-Some of the findings: having a “Low income seemed to magnify the emotional pain of life’s misfortunes, including divorce, illness and loneliness.” However, there was a tipping point of $75,000 where having more money didn’t help improve one’s well-being:

The researchers suggest that making anything more than $75,000 no longer improves a person’s ability to spend time with friends, avoid pain and disease and enjoy leisure time – all factors involved in emotional well-being.

“It also is likely that when income rises beyond this value, the increased ability to purchase positive experiences is balanced, on average, by some negative effects,” they write. For instance, a past study revealed a link between high income and a reduced ability to savor small pleasures, the researchers noted.

This tipping point of $75,000 is above the median income in the United States. I would be curious to know if individuals feel this tipping point when their income does rise to this level – are they cognizant of this point? Or once they reach $75,000, are they still locked into a mindset that having more money will lead to increasing levels of well-being?

Also, this $75,000 point could be quite fluid. Over time, this point would change based on economic conditions and cultural understandings of what is a “good income.”

Older age = more wisdom, happiness

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In a youth-oriented culture like that of the United States, growing older may not appear appealing to many. But recent research suggests that growing older leads to more wisdom and increased levels of happiness:

Contrary to largely gloomy cultural perceptions, growing old brings some benefits, notably emotional and cognitive stability. Laura Carstensen, a Stanford social psychologist, calls this the “well-being paradox.” Although adults older than 65 face challenges to body and brain, the 70s and 80s also bring an abundance of social and emotional knowledge, qualities scientists are beginning to define as wisdom. As Carstensen and another social psychologist, Fredda Blanchard-Fields of the Georgia Institute of Technology, have shown, adults gain a toolbox of social and emotional instincts as they age. According to Blanchard-Fields, seniors acquire a feel, an enhanced sense of knowing right from wrong, and therefore a way to make sound life decisions.

That may help explain the finding that old age correlates with happiness. A study published this year in the Proceedings of the National Academy of Science found a U-shaped relationship between happiness and age: Adults were happiest in youth and again in their 70s and early 80s, and least happy in middle age. A 2007 University of Chicago study similarly concluded that rates of happiness — “the degree to which a person evaluates the overall quality of his present life positively” — crept upward from age 65 to 85 and beyond, in both sexes.

These are interesting findings. Now how could American culture go about showing and sharing these benefits of growing old? Wisdom, in particular, might be a challenge to portray in commercial advertisements.

Also, there is an interesting discussion in the article about how to define and measure “wisdom.”