Money and Happiness on Marketplace

by Will Wilkinson on March 12, 2008

This morning’s commentary says, in a nutshell, that money does matter to happiness, so if we’re going to slow growth, it damn well better be worth it. But listen!

GilM

Yeah, I was thinking along the lines of Benquo.

Actually, since we're covering the range $0 to $30,000, the point could actually be below $30,000 too.

But, that would be hard to believe.

I'm not claiming that there is such a point. I'm just wondering if the evidence shows any difference between people with very high incomes.

I guess I was focusing on the "There isn’t" assertion assertion in the commentary. Maybe it would have been better to say "There isn't any evidence of such a point." (if that's true). The way it was stated, it sounded like there was strong evidence that no such point exists.

I understand that it's hard to be precise in a commentary like that, and still be broadly engaging. But, maybe there's a simple way to re-word the point that would still maintaing the good features, and protect it from this objection.

Benquo

Mr. Wilkinson,

Any leveling out point between $30,000 and $100,000 would still allow a gap of any finite magnitude between the less-than-$30k and more-than-$100k crowds, would it not?

Benquo

Gil,

At least by Bayesian standards, absence of evidence is (weak) evidence of absence.

In other words, if there were some such point I would expect to find it. So far, we haven't found it. This disappointment of our expectations should cause us to believe what caused our expectations less strongly than before.

Will Wilkinson

Gil, Good point. (Did you mean above $100,000) The challenge of these things is to do an accurate cartoon of the facts, since it's too short to be extremely precise.

GilM

Great commentary. You're getting really good at these!

One quibble is that you said:

"It's tempting to think that there's is a point at which money no longer matters, but according to the latest research on happiness, there isn't. Wealthier people tend to be happier. According to a 2006 Pew Research Center survey, Americans making over $100,000 a year were more than twice as a likely to say they are "very happy" than those making under $30,000."

Is there more evidence that it's not the case that there is such a point, but it's above $30,000?