Money and Happiness: What Does Economic Progress Bring?

Bruno S. Frey

«Money and Happiness: What Does Economic Progress Bring?»

Harold James

«Happiness»

Does money make you happy? Economists usually answer this question with: Yes. Those who have more money are more likely to be able to afford the goods that bring them great benefits. Recently, however, this view has been challenged within our own guild. Studies dealing with happiness show that although the standard of living in industrialised countries has risen dramatically in recent decades, these changes have not led to people feeling happier. This finding casts doubt on the demand for more growth, as economic activity should not be pursued as an end in itself, but rather to increase people’s well-being. At the 20th Economic Conference organised by the Progress Foundation and the Council on Public Policy in Zurich on Tuesday, Princeton historian Harold James and Zurich economics professor Bruno S. Frey explored happiness from an economic perspective.

Content

«Money and Happiness: What Does Economic Progress Bring?»

Speech by Bruno S. Frey (in German)

Swiss economist and visiting professor for Political Economy, University of Basel

What is the connection between money and happiness? It seems perfectly clear: ‘Money does not make you happy’. It would be ridiculous to believe that money can make you happy. For psychological and genetic reasons alone, this cannot be the case. But there is another view that says: ‘Money makes you happy’. People say that income plays a major role in happiness. And that is also completely obvious. After all, why would people chase after money like that if it made them unhappy? So we have two statements that both seem true, but are completely contradictory. I would therefore like to present three correlations between income and happiness. Firstly, the correlation between countries. Then over time, and finally within a country between people at a certain point in time.

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Text of the Speech