Dr. Arthur Brooks explains why money stops making you happier. Modest income solves real problems like paying rent and feeding children, but beyond that, each raise brings less joy. People chase that initial relief without realizing the happiness boost fades.
We think more resources is better, that it's going to make us happier. That's wrong. That's why Grandma said, money won't be able to buy happiness. And you said, let me try. I could just have that. Yeah, that amount. Exactly right. Money will allow you to alleviate many sources of unhappiness at low levels. What we find is that people, when they have a lot of negative emotionality because of bad circumstances in their lives, a little bit of resources can alleviate that. But they make a mistake by thinking, I feel a lot better. So therefore, money buys happiness. No, no, no. You feel less unhappy because you're able to pay your rent, because you're not staying up all night worrying about your bills, because your kids are meeting their caloric needs. But it doesn't take very much to satiate that, to get to the top of that. And then after that, you chase, chase, chase, chase, chase for the rest of your life. You'll get into this weird hamster wheel of looking for the relief they first felt when they got their first big paycheck.
