In one recent study examining money’s effect on happiness, Kahneman, and others, have found that people with a relatively high income, although more satisfied with their lives, are barely happier at any given moment than those with a significantly lower income. The age-old myth that money buys happiness needs to be refined, as does the competing myth that wealth does not matter.What he’s found in comparative studies of nations is that both the level of corruption and the degree of trust in society are important predictors of well-being. “Corruption is a measure of trust in society, and trust, it turns out, should be essential to well-being.”
Countries where the level of trust in society is very low have a lot of difficulty thriving economically—so you need a certain level of trust to get moving.
“But even when you look at the Western world where GDP is more or less constant, you find large effects of trust, and that’s why Northern Europe always emerges as the best place to be in the world in terms of well-being research.”
Can this be applied in developing countries? “If there is a way of encouraging increasing trust in society—and that should probably start with trust in institutions—that is going to make a contribution to GDP through the rule of law, respect for property, and so on. It will have an extra contribution to human welfare because happier societies are ones where people trust each other and spend a fair amount of time catering to social needs.”
via Finance & Development, September 2009 – Questioning a Chastened Priesthood.
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