Money does indeed buy happiness, and it increases with a bigger paycheque more than economists previously believed, a recent analysis has found.
Widely reported findings by two Nobel Prize-winning economists in 2010 cemented the idea that money could buy happiness only to a certain point — and that point was said to be about $75,000 at the time.
"The [Daniel] Kahneman and [Angus] Deaton paper in 2010 found that the relationship between income and happiness, or emotional well-being, flattens out at around $75,000," said Kostadin Kushlev, a happiness researcher and assistant professor at Georgetown University's department of psychology in Washington, D.C.
Now one of those researchers says he was wrong about the $75,000 part — and not just because everything is so expensive these days.
A paper Kahneman co-authored with Matthew Killingsworth and Barbara Mellers in 2023 concluded that the 2010 research had overstated the plateau effect because it used an unreliable method of measuring happiness from a Gallup survey, which asked study subjects to recall if they smiled the previous day.