Several studies have analysed the relation between money and happiness. For example, a study published in 2010 sampling 1000 Americans suggested happiness increases steadily as income grows bigger, but only up to around 75k per annum. Now, a larger and more robust study yields roughly the same conclusion.

How big was the new study?

Data was collected by interviewing 1,709,734 people 15 years of age or older from 164 countries across 12 years. Gender balance was 0.89:1.00 male:female, and care was put to make each survey nationally representative. Income was measured as yearly household equivalized US dollars, controlling for the number of household individuals. Limitations to the study include the fact that as income increases, availability of study subjects goes down, especially in poorer regions, and the self-reporting nature of the study.

What do we talk about when we talk about happiness?

Generally, these "happiness" studies analyse a metric known as "Subjective Well Being" (SWB), which is composed of three factors:

• Positive affect: experience of positive or pleasant emotions or moods.

• Negative affect: experience of unpleasant or stressing emotions or moods.

• Life evaluation or satisfaction: judgement of one's own life globally and specifically (such as work satisfaction.)

The three factors are usually derived by self-assessment, ie. participants are given a questionnaire (including questions such as "Did you smile or laugh a lot yesterday?" or “Did you experience the following feelings during a lot of the day yesterday?"), and the positive and negative affects can later be combined to produce an "affective balance."

What did the new study conclude?

• Results are summarized in the following table ("satiation" being the income value that maximized each factor):

• Globally, satiation for life evaluation occurred at around the 95k point. Satiation for positive emotions occurred at around the 60k mark, and for negative emotions circa the 75k point.

• Life evaluation actually goes down a little after this satiation point (in five out of nine regions: both European regions, East Asia, and the two regions in the Americas). Potentially, this could be explained by more demanding jobs at higher income brackets or unfulfilled social comparisons, but further research is suggested by the study authors.

• There's a strong correlation between median regional income and their satiation point (ie. wealthier regions have higher satiation points). This could be explained, at least in part, due to strong social comparisons effects (which have been reported previously) where individuals mold expectations based on what they can see around them.

• Wealthier nations tended to have higher levels of happiness (life evaluation) at their satiation point, suggesting poorer regions have potential happiness to yet tap into as wealth increases. The satiation points of the poorer regions can also be expected to increase with wealth.

• In contrast to expectations, women had a higher life evaluation satiation point compared to men.

• As expected, higher education levels increased satiation points, probably due to income expectations.

Read more here:

"How Much Money Would It Take to Make You Happy? Scientists Calculate" at LiveScience

Original studies:

"Happiness, income satiation and turning points around the world" at Nature Human Behaviour (2018)[PAYWALL]

"High income improves evaluation of life but not emotional well-being" at PNAS (2010)