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  • Journal of Positive Psychology

From Wealth to Well-Being? Money Matters, but Less than People Think

By: Lara B. Aknin, Michael I. Norton and Elizabeth W. Dunn
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Abstract

While numerous studies have documented the modest (though reliable) link between household income and well-being, we examined the accuracy of laypeople's intuitions about this relationship by asking people from across the income spectrum to report their own happiness and to predict the happiness of others (Study 1) and themselves (Study 2) at different income levels. Data from two national surveys revealed that while laypeople's predictions were relatively accurate at higher levels of income, they greatly overestimated the impact of income on life satisfaction at lower income levels, expecting low household income to be coupled with very low life satisfaction. Thus, people may work hard to maintain or increase their income in part because they overestimate the hedonic costs of earning low levels of income.

Keywords

Happiness; Work-Life Balance; Satisfaction; Income; Household

Citation

Aknin, Lara B., Michael I. Norton, and Elizabeth W. Dunn. "From Wealth to Well-Being? Money Matters, but Less than People Think." Journal of Positive Psychology 4, no. 6 (2009): 523–527.
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About The Author

Michael I. Norton

Negotiation, Organizations & Markets
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More from the Authors
  • The Emotional Rewards of Prosocial Spending Are Robust and Replicable in Large Samples By: Lara B. Aknin, Elizabeth W. Dunn and Ashley V. Whillans
  • Opportunity Neglect: An Aversion to Low-probability Gains By: Emily Prinsloo, Kate Barasz, Leslie K. John and Michael I. Norton
  • Relational Diversity in Social Portfolios Predicts Well-Being By: Hanne K. Collins, Serena F. Hagerty, Jordi Quoidbach, Michael I. Norton and Alison Wood Brooks
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