September 29, 2015
Don’t Worry About Money. Just Be Happy
The adage that money won’t buy happiness has been proved wrong – at least up to a point. One famous study found that one’s well-being increases as income rises, though the benefits subside around $75,000 per year.
But what about the reverse? Do people who are happy earn more money? Yes, say two British economists.
Their study in the Proceedings of the National Academy of Sciences concluded this after following American teenagers for more than a decade through the National Longitudinal Study of Adolescent Health. In 1994 and 1996, this survey asked high school students to react to statements like “You were happy” and “You felt hopeful about the future.” In a 2008 follow-up survey, when most of them were around age 30, they were asked how much money they were making.
People who reported having a happy adolescence earned about $3,400 more than the average gross income of all the survey respondents; the average was $34,642. However, the opposite effect was more consequential: young adults who had a “profoundly unhappy adolescence” were earning 30 percent less – equivalent to a $10,000 hit to their earning power.
The researchers found similar results when they compared siblings in the survey, a natural way to control for environmental effects. They also controlled for self-esteem, another determinant of how people fare in the work world, as well as other factors such as intelligence and physical health.
It’s simplistic to assert that happiness is the only thing going on here – there must be more substantial reasons for a strong association with income. So the researchers looked for some plausible “pathways” through which teen well-being might translate to higher pay later. The results weren’t surprising. The mediating pathways for happier people included having a higher likelihood of obtaining a college degree, of getting hired and promoted more easily, and of being optimistic and extroverted.
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