2023-12-19 20:35:26
Two eminent researchers compared their divergent results to provide an answer to the eternal question: “If I accept a promotion and get a better salary, will I really be happier?” (Photo: Mathieu Stern for Unsplash)
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Q. – “We say everything and its opposite regarding money and happiness. But I would like to know what it is, once and for all: if I accept a promotion and get a better salary, will I really be happier? – Patricia
A. – Dear Patricia, it turns out that scientific research has recently taken a big step in solving this seemingly eternal problem. And I can’t resist the pleasure of sharing with you the story of this big step as well as, of course, what results from it. Let’s look at this together.
In 2010, psychologist and economist Daniel Kahneman, “Nobel Prize” in economics in 2002, and economist Angus Deaton, “Nobel Prize” in economics in 2015, joined forces to find out if earning more money made happier. Their conclusion, in a study that has been authoritative for many years: yes, earning more increases happiness, but once we reach an annual salary of 90,000 US dollars ($122,000), our happiness plateaus. We are therefore not really happier in life if we earn 150,000 dollars, 200,000 dollars or 250,000 dollars.
Everyone, or almost everyone, then considered that there was a salary ceiling to happiness, namely the symbolic bar of 122,000 dollars.
But now in 2021 another scientist wanted to check whether this ceiling still held, or not. Matthew Killingsworth, a senior researcher at the Wharton School, revealed the fact that in truth there was no salary cap: it’s quite simple, the more money you earn, the happier you are; regardless of salary level.
Who is right? Who’s wrong? The two “Nobel prizes” or the “little” researcher from Wharton? Well, that’s where the story gets fascinating!
Imagine, Patricia, that Daniel Kahneman and Matthew Killingsworth got in touch to talk regarding it and agreed to work together on a brand new study to clarify all this. In 2022, one analyzed the work of the other, and vice versa. Then, they combined their findings to find out, once and for all, what the possible link between money and happiness was. All this, by calling on a neutral intermediary, Barbara Mellers, professor of psychology at the University of Pennsylvania, in the hypothetical case where a dispute had arisen between the two researchers.
Result? Hold on tight, everyone has discovered “errors” in the other’s study!
– Kahneman and Deaton’s error consisted in the fact that they were mainly interested, in fact, in a very particular sample of people, namely the “15% of people least happy in life”. For these people, earning more money feels good, but there comes a time when money no longer really makes a difference, or rather a time when money is no longer their real problem, but something else entirely. (for example, love life, connection with loved ones, etc.).
In other words, there would indeed be a ceiling, but for people who are not really happy in life. The mystery remains for others.
– Killingsworth’s error was that he considered people as a global entity so that, overall, an increase in income leads to an increase in happiness. But this global vision does not correspond to reality. For example, it seems logical to say that the relationship with money is not the same when you are part of the 10% of the richest people in the population considered or when you are part of the 10% of the least wealthy. That changes everything, because we can imagine that a 5% increase in income makes a real difference for someone who is poor, whereas for someone who is rich, it doesn’t make their heart beat that much.
In view of all these errors, the two researchers corrected them by mutual agreement, this time considering the entire population, divided into strata according to their level of happiness in life before a crisis occurred. substantial financial gain.
The result is in one image:
Source: «Income ans emotional well-being: A conflict resolved»; Killingsworth, Kahneman, Mellers. (courtoisie)
What does it mean? It’s simple:
– For the 15% of people who are least happy in life, there is a ceiling of 100,000 US dollars ($135,000) at which earning more money doesn’t really give them more happiness.
– For people who are not very or moderately happy in life (the least happy 30% and 50%), earning more always makes them happy. And this, regardless of their level of annual income, whether they pocket $30,000 or $240,000 per year. The progression is linear as the salary level increases.
– For people who are happy or very happy in life (the happiest 30% and 25%), earning more money always increases their happiness. Better still, the higher their income, the more their happiness increases tenfold, from the moment we exceed the symbolic bar of 100,000 US dollars ($135,000)!
In short, it all depends on your level of happiness in life when you pocket more money.
If you’re not truly happy, it won’t make much difference to your enjoyment of life, unless you earn less than $135,000 a year.
If you are reasonably happy, it will always make you happy to have more money.
And if you bathe in happiness every day, earning more will make you even happier, especially if your annual income exceeds $135,000.
There you go, Patricia. I don’t know to what extent you feel happy in life, it’s up to you to identify the stratum to which you belong. This will then allow you to estimate whether the potential financial gain that might result from the promotion you are talking regarding is likely to really bring you more happiness, or not.
By the way, the Greek playwright Sophocles said: “Happy is he who knows that he is happy.”
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#earning #money #happier
