Published, with copy-editing changes, in the Illawarra Mercury, 12 August 2009, p. 16. Submitted under the title "The quest for money - or happiness".
The ongoing attention to the global financial crisis would make you think the economy is the most important thing affecting people's lives. But from the point of view of happiness research, the quest for an ever-growing economy is misguided.
Researchers have found, surprisingly, that making a bundle of money doesn't do much for your happiness. Lottery winners, a year or so down the track after their jackpots, have reverted to their previous happiness levels. A typical billionaire isn't much happier than a person on the average wage.
The reason is a process called adaptation. When you get a pay rise, move to a larger house or buy a new car or stylish outfit, this is satisfying at first but before long you adjust to your new circumstances. Before it was exciting; now it's just the norm.
The same process also happens in reverse. Those who don't get a promotion end up just as happy as those who do.
The strange thing is that most people believe the opposite: they think more money or possessions will give them greater life satisfaction. That's what makes the economy seem so important. Advertisers help the process along by encouraging people to think that having more and better things will make them happier.
There's one exception to this pattern: poverty. If your income is really low, you're likely to be less happy. So if a government wanted to improve the country's gross national happiness - as distinct from gross national product - the best policy is to take serious steps to address homelessness, poverty and abuse and to make income levels more equal.
It's not how much you have that's important but how much you have in relation to others. Research shows that people would rather live in a $300,000 house where all the neighbours are in $250,000 houses than live in a $400,000 house where all the neighbours have $500,000 houses.
When everyone's incomes increase, everyone adapts and average levels of satisfaction hardly change. Surveys in several countries, such as Britain and the US, show that although income per capita doubled within a few decades, happiness levels remained just about the same. This phenomenon is sometimes called the hedonic treadmill: you work hard to get ahead but, in terms of satisfaction, end up in the same place.
Rather than put all your energy into making more money, there are other ways to bring greater satisfaction to your life. One of them is to make new friends, or deepen the friendships you have.
I know people who take on a second job in order to keep up their lifestyle. But research suggests they'd be happier by foregoing the extra money and putting that extra time into friendships.
There are lots of other ways to increase happiness, for example regularly expressing gratitude for the good things in your life, developing the capacity to forgive those who have hurt you, acquiring a habit of optimism and learning to live in the moment. None of these costs very much. They do require time and commitment. Strangely enough, being content with your life requires ongoing effort to build and maintain positive mental habits.
Most important is doing something that is really meaningful to you and exercises your capacities to the limit.
Happiness research is subversive. It challenges those who say "more, more, more" and "grow, grow, grow." It puts more attention on creating meaning within our lives than on pursuing external stimuli that promise fleeting pleasures.
It's only humans who join what's called the rat-race. The race has no winners because the real action is somewhere else.
Brian Martin is professor of social sciences at the University of Wollongong.
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