Tuesday, March 8, 2005

How not to buy happiness

Came across this article on the web yesterday, entitled How Not to Buy Happiness.

I've been doing quite a bit of reading lately, particularly on the truth that increased wealth does not result in greater happiness. Study after study has shown that increases in income cause temporary spikes in joy, but long-term effects are fleeting since people will adapt to their new wealth and return to their base level of happiness.

[As an aside, the article and others also argue, that people adapt to change quite readily. After a terrible accident, one that results in loss of limbs or other major appendages, people adjust:
Within a year’s time, many quadriplegics report roughly the same mix of moods and emotions as able-bodied people do.
But, Lucy Grealy never seemed to adapt to losing 1/3 of her face to cancer. She spent her whole life doing one reconstructive surgery after another, trying to rebuild a perfect face. She never felt that she would loved for who she was (at least based on her book and others), and was always looking to be special. But, then again, one might argue, she might have been this way regardless of having cancer.]

In Martin Seligman's book, Authentic Happiness, he states:
As far as happiness and life satisfaction are concerned, however, you needn't bother to do the following:
6. Make more money (money has little or no effect once you are comfortable enough to buy this book, and more materialistic people are less happy)
7. Stay healthy (subjective health, not objective health matters)
8. Get as much education as possible (no effect)
9. Change your race or move to a sunnier climate (no effect)

Interestingly enough, the article "How Not to Buy Happiness" proposes that it is not consumption itself that has little effect on happiness, instead the author argues that conspicuous consumption does not further happiness/life satisfaction. However, inconspicuous consumption can have an effect. For example, money can be used to purchase "freedom from a long commute or a stressful job."

The author gives two examples, in example A you could own a 4,000 square foot house (um, I guess he's not living in NYC!) or in example B, you could own a 3,000 square foot house and then the residents
use the resources saved by building smaller houses to bring about some other specific change in their living conditions... the cost savings from building smaller houses are sufficient to fund not only the construction of high-speed public transit, but also to make the added flexibility of the automobile available on an as-needed basis.


It would seem that example B would be preferable to example A (at least for me!).

But, I suppose the way that society is structured, and the way we tend to think individualistically (if you're not accountable for yourself and your own affairs, who will be?), the construction of a convenient, transit system that will benefit everyone is unlikely.

Would you rather pay more taxes and hope that the persons allocating money fund projects that will benefit everyone (including yourself)? Or would you rather have a sure thing, as in keep the money that you would pay in taxes for a convenient transit system and instead be able to afford a bigger house. I guess then we're kind of going into the realm of game theory. But do people really think rationally?

In any case, I do think that its interesting to consider that we spent all this time earning money so that we can have large houses, but that results in: (1) less time with family/friends, (2) less time for exercise and (3) less time for vacation.. maybe its better to just have the smaller house..

So we can buy happiness though, by increasing convenience? Hmm, maybe I should hire that maid to clean my bathroom! But, its an economic trade-off, you are trading the economic output from doing work that you (hopefully) like and are skillful at for work someone else likes and is skillful at. That way, we can all do what we like, right??

Here's another link about how long you should wait for your dreams (using an investment banker and a simple fisherman as an example).