Last Call For All About The Garbos

At least in Sweden, money does indeed buy you happiness, as a new study from two Stockholm University researchers (and one from NYU) finds, and there's direct evidence that increased overall life satisfaction can be attributed to people who win lotteries. Justin Wolpers from the NY Times explains.

New research suggests that more money really does lead to a more satisfying life. Surveys of thousands of Swedish lottery winners have provided persuasive evidence of this truth.

Lottery winners said they were substantially more satisfied with their lives than lottery losers. And those who won prizes worth hundreds of thousands of dollars reported being more satisfied than winners of mere tens of thousands.

These effects are remarkably durable. They were still evident up to two decades after a big win. (The researchers lacked the data to trace out even longer-term consequences.)

The findings appear in a research report, “Long-Run Effects of Lottery Wealth on Psychological Well-Being,” that has generated a lot of buzz among economists over the summer. The working paper, by Erik Lindqvistfrom the Stockholm School of Economics, Robert Ostling from Stockholm University and David Cesarini from New York University.

It is certain to feed a long-running debate about the role that personal finances play in shaping subjective well-being.

Many previous analyses — including several that I have conducted with my partner, Betsey Stevenson, a fellow University of Michigan economist — have documented that people with higher incomes tend to report higher levels of life satisfaction. The relationship between income and satisfaction is remarkably similar across dozens of countries, suggesting that findings about Sweden likely apply to the United States.

Those earlier studies merely documented a correlation. What’s new here is the evidence that higher income is causing higher life satisfaction.

The study also makes the distinction between happiness and life satisfaction, much like the difference between weather (a snapshot in time) vs climate (a long-term observable trend).  Not having to worry about basics like food, shelter, and the like does relieve a lot of stress, turns out.

That's something America should keep in mind, I think.  We still believe that being able to eat and live in a place is something that must be earned through a lifetime of hard work, and then through the discipline of a lifetime of frugal savings once retired, resulting in being able to pass a home on to your children, or having a home passed down to you from a parent or grandparent that did the same to earn the privilege of land ownership, otherwise you're "lazy" and deserve to be homeless.

It's not right, but there it is, and of course that will never change while we have the current administration in power.