CAN MONEY BUY
HAPPINESS?
L. Etherington, H. Gwilt & S. Phylaktou
Overview
• Introduction
• Research Paper 1: Money and mental wellbeing
(Gardner, J. & Oswald, A. J., 2006)
• Research Paper 2: Money matters, but less than
people think
(Aknin, L. B., Norton, M. I. & Dunn, E. W., 2009)
• Suggested Improvements
• Other research
• Conclusion
Introduction
• Money is power
• People = Risk Aversive
• Loss = Painful (activates anterior insula, associated with
pain and disgust)
• Changing population
• Increase of women in work: doubled since 1950’s
• Family size decreasing: 1.8 children per couple
• Caldwell (1976): children = economic liabilities
• University studies – why are we here?
Dillow (2012), Livesey & Lawson (2008), Heathfield, USA GOV (2003)
Paper 1: Lottery Wins and Wellbeing
Aims
• Aimed to see effect of lottery wins on wellbeing
Method
• Longitudinal Study
• 137 medium-sized lottery wins between 1998-2001
• Compared to 2 control groups; small wins and no wins
• Used GHQ scores from the BHPS to gain an objective
measure of mental wellbeing
Gardner, J. & Oswald, A. J. (2006)
Results
• On average, mental stress
increases in year of win
• Mental wellbeing increases
after two years (1.4 drop in GHQ)
• Similar increase for both sexes,
men slightly larger
Conclusions
• Winning the lottery is associated with improved mental
wellbeing
Gardner, J. & Oswald, A. J. (2006)
Critique
Suggested Improvements
Objective measurement of well
being –GHQ score
N/A
Experiment using control groups
- increased validity
N/A
Culturally dependent
Multi-cultural sample
Small sample – only 137
Larger Sample
Concluded increase in wellbeing
was result of lottery winning presumption?
Need to measure other life
factors. Should have explicitly
asked.
Unable to measure adaptation to
money over long period
Should have followed up
Boundaries between medium
sized wins and small wins are
too small
Should have boundaries that are
more separate
Paper 2: Money matters, but less than
people think
Part 1: Predicting wellbeing of others based on household income
Aims
•Examine the accuracy of laypeoples intuition about
relationship between household income and wellbeing of
others
Method
•429 Americans reported annual income from list of
categories
•“How would you rate your life overall these days?”
•Consider 10 different household incomes, asked to predict
the life satisfaction of someone at each income level
Aknin, L. B., Norton, M. I. & Dunn, E. W. (2009)
Results
• People on higher incomes reported
greater happiness
• Accurately estimated higher levels
of household income with greater
happiness
• Overestimated the unhappiness of
those in lower income households
Aknin, L. B., Norton, M. I. & Dunn, E. W. (2009)
Study 2: Money matters, but less than
people think
Part 2: Predicating wellbeing of oneself based household income
Aims
•Test validity of part 1 – i.e. should still wrongly predict the
association between money and happiness
Method
•315 Americans reported annual income from list of
categories
•“How would you rate your life overall these days?”
•Consider 10 different household incomes, asked to predict
the life satisfaction of themselves at each income level.
Aknin, L. B., Norton, M. I. & Dunn, E. W. (2009)
Results
•Showed consistency when predicting
their own and others happiness
•Results support findings of Study 1
Conclusions
•Vastly overestimate emotional cost associated with being
poor… i.e. money matters, but less than people think
Aknin, L. B., Norton, M. I. & Dunn, E. W. (2009)
Critique
Critiques
Suggested Improvements
Rewards for participation –
increased motivation
N/A
Used consistent methodology
across both parts of study
N/A
Culturally dependent
Multi-cultural sample
Subjective measurement of
wellbeing
Need standardized, objective
measurement
2 Different Samples
Within subjects design
Other Research
• Diener et al. (2010) - conducted a study on wealth and
happiness. Used worldwide sample of 136000 subjects and
found that long term income changes are more related to
positive life evaluations not feelings.
• The ONS has found that being married is 20 times more
important to a person’s well-being than their earnings, so the
increase in wellbeing in the lottery study may have been due to
other factors such as getting married.
• P. Brickman, D. Coates, & R. Janoff-Bulman (1978) – lottery
winners were not happier than controls and took significantly
less pleasure from a series of mundane events. Found not to
be due to pre-existing differences. Evidence for adaption level
theory.
Adaptation Level Theory
vs. Assimilation Contrast Theory
Will you always need more?
• Adaptation Level Theory:
Contrast + Habituation = No increase
Vs.
• Assimilation Contrast Theory:
Original Judgment + Attitude = Anchor = Increase
Helson, H (1947), American Journal of Psychology
Investigating within the student
environment
• May get a different relationship between wealth and
happiness among students compared to middle aged
adults.
• Use an anonymous questionnaire to gain info such as:
• Amount of debt they will be in after graduating
• How much money they are given each month from parents
• Whether they receive more than the standard loan or any loan at all
• Use a previous measure for rating happiness/wellbeing
such as the GHQ measure.
Evidence that winning big doesn’t lead to
a better life or happiness:
• Michael Carroll nicknamed ‘lotto lout’
won £9.7million on the lottery
• Blew all his winnings on drugs,
prostitutes and cars
• Been in court over 30 times and
jailed for the drug offences
• Now works in a biscuit factory
earning £6 an hour
• Claims he is now happier
Papworth (2013)
Conclusions
• Evidence for and against money buying happiness
• Paper 2 more in favor of Adaptation Level Theory
• Paper 1 more in favor of Assimilation Theory – needs to
be longer?
• Happiness is very subjective
• Maybe it buys happiness up to a certain extent, but there
are other more influential factors that should be
considered i.e. marriage
• Maybe if you actually earn the money, as opposed to
being handed it (i.e. the lottery), you have a greater
respect for it and therefore it makes you happier for longer
– further research?
“Wealth without
work, one of the
seven deadly
sins” – Ghandi
“If you want to feel rich, count the
things that money can’t buy”
“If you realise that you have enough,
you are truly rich” – Lao Tzu
“There are people who have
money, and people who are
rich” – Coco Chanel
"It is pretty hard to tell what does bring
happiness; poverty and wealth have both
failed" - Kin Hubbard
ANY QUESTIONS?
References
Aknin, L. B., Norton, M. I. & Dunn, E. W. (2009). From wealth to well-being?
Money Matters, but less than people think. The Journal of Positive Psychology,
4, 523-527.
Brickman, P., Coates, D., Janoff-Bulman, R. (1978). Lottery winners and
accident victims: Is happiness relative? Journal of Personality and Social
Psychology, 36, 917-927.
Diener, E. et al. (2010). Wealth and Happiness Across the World: Material
Prosperity Predicts Life Evaluation, Whereas Psychosocial Prosperity Predicts
Positive Feeling. Journal of Personality and Social Psychology, 99, 52-61.
Dillow, C. (2012, January). Lost money? You should forget about it. Retrieved
from:http://www.ezonomics.com/blogs/lost_money_you_should_forget_about_it
/
Gardner, J. & Oswald, A. J. (2006). Money and mental wellbeing: A longitudinal
study of medium-sized lottery wins. Journal of Health Economics, 26, 49-60.
Heathfield, S. Women and work: Then, now, and predicting the future for
women in the workplace. Human Resources.
Helson, H. (1947). Adaptation-Level as Frame of Reference for prediction of
psychophysical data. The American Journal of Psychology, 60, 1-29.
References
Livesey, C. & Lawson, T. (2008). Family Households. AS Sociology for AQA. 2;
64-76. Retrieved from:
http://www.sociology.org.uk/sc_shop_pdf/sc_AS4AQA_family_e.pdf
Papworth, A. (2013). Norfolk lottery winner Michael Carroll now earns £6 an
hour. EDP 24. Retrieved from:
http://www.edp24.co.uk/news/norfolk_lottery_winner_michael_carroll_now_ear
ns_6_an_hour_1_2268736
Swinford, S. (2013, May). Marriage makes people happier than six figure
salaries and religion Marriage. Retrieved from:
http://www.telegraph.co.uk/news/politics/10090130/Marriage-makes-peoplehappier-than-six-figure-salaries-and-religion.html
USA GOV (2003). Achievements in public health: Family Planning. CDC. 48;
1073-1080. Retrieved from:
http://www.cdc.gov/mmwr/preview/mmwrhtml/mm4847a1.htm