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Does relative wealth make us happier than absolute wealth?

As social creatures, our happiness may be dependent on our status. If this is the case, it may help explain why the pursuit of money for the average person at best only keeps their happiness level constant.

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Experts and Influencers

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Agree
Experts In Economics


The Economist    Politics and Business Magazine
Agree
...people tend to compare their lot with that of others. In one striking example, students at Harvard University were asked whether they would prefer (a) $50,000 a year while others got half that or (b) $100,000 a year while others got twice as much. A majority chose (a). They were happy with less, as long as they were better off than others.
07 Aug 2003    Source


Experts In Sociology


Glenn Firebaugh    Sociology Professor
Laura Tach    Sociologist
Agree
We find that the higher the income of others in one‟s age group, the lower one's happiness, with and without controls for age, health, education, marital status, and other correlates of happiness. Since real incomes tend to increase over most of one‟s working life, this finding implies that working-age families must earn more and more over time to maintain a constant level of happiness. This is an example of what Brickman and Campbell (1971) called a “hedonic treadmill”...
17 Jun 2008    Source


Experts In Business


Donald Trump    American Business Magnate
Agree
[Money is] a scorecard that tells me I've won and by how much. [If that is the definition] then yeah, I do it for the money.
01 Feb 2002    Source


Disagree
Experts In Business


Justin Wolfers    Business Professor
Betsey Stevenson    Business Professor
Mostly Disagree
Our evidence is consistent with the view that only absolute income matters to happiness (which would imply that the within- and between-country estimates are identical). Indeed, whereas previous analyses of the link between income and happiness had suggested a prima facie case for relative income playing a dominant role, our updated re-analysis yields no such case.
09 May 2008    Source



Comments

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0 Points      Nashhinton      21 Apr 2013      Stance on Question: Agree
Studies tend to show that relative wealth leads to excessive happiness because it behaves like a point system. That's why we shouldn't simply redistribute wealth through taxation to establish unwarranted egalitarianism, but we should rather provide basic services and opportunities to citizens to increase their motivations to succeed. We need universal college education, job training, universal healthcare (healthy citizens are happy) etc., or any other type of mechanism to encourage citizens to work to eventually accumulate wealth on their own and stimulate the economy. We must ensure that citizens can easily move to the top of the ladder without obstacles, fairly, and without wide disparities of difficulty levels. It may lead to happiness, but it's immoral to accumulate and safeguard vast quantities of wealth in a vault somewhere without using it to stimulate future economic growth. I'm an ethical socialist who promotes a free competitive market and a large work ethic.


1 Point      TZX      16 Feb 2011      Stance on Question: Mostly Agree
Quite probably. Humans show an amazing capability for hammering down the nail that sticks out.


0 Points      Anonymous      08 Nov 2010      General Comment
I think this question should be reworded to make it clear we're talking about absolute purchasing power as opposed to non-inflation adjusted dollar values.


0 Points      the27th      26 May 2010      Stance on Question: Mostly Disagree
Up to a point, happiness rises with GDP among different countries. Absolute wealth matters. There's evidence that relative wealth matters as well, but as I understand high relative wealth can't compensate for a sufficiently low absolute wealth.


0 Points      Benja      27 May 2010      Editorial Comment
I wonder whether I should reword the question with a qualification so as to exclude abject poverty? What I think is interesting about this question (correct me if I'm wrong) is whether the benefit of economic growth has leveled out for rich countries.