Happiness and Money
A complementary quality-of-life research path has been to study the link between income (or material well-being) and happiness. In the 1970s the demographer Richard Easterlin discovered—now known as the Easterlin Paradox—that within countries there was a direct correlation between a person’s income level and his or her self-reported well-being, but over time and across countries there was no such association. The explanation was that one’s satisfaction is relative, not based on some absolute standard of living. So keeping up with the Joneses or suffering along with them are equivalent. Since then other researchers have found the expected positive relationship between income and well-being across countries.
At the moment, the measure of subjective well-being is perhaps the hot topic among economists and psychologists (the intersection of the two fields is known as behavioral economics). The development of National Time Accounting (NTA), with a focus on time-use and individuals’ emotional experiences across nations, is one such "happiness research" effort. The State of the USA project contributes many more scientific statistical indicators to help Americans evaluate how they—and we as a nation—are doing. Former Harvard president Derek Bok has also gotten into the fray with his book—The Politics of Happiness—on how governments can implement such findings to improve the lives of their citizens.
