Money can’t buy happiness

That was my parent’s justification for the below-my-peer-group-rate of pocket money they gave to me as I was growing up. So, you can imagine my surprise upon reading a recent headline in The Economist – Money really can buy happiness and recessions can take it away.
Using data from polls taken in 145 countries between 2005-2019, it would seem my parents had it wrong, in part. It’s often been said that GDP has its limitations in terms of measuring a nation’s true progress. Even when the concept of GDP was developed by Simon Kuznets in 1934 these inadequacies were known. It is simply a measure of the total monetary or market value of all finished goods and services produced within a country’s borders in a specific time period. One of the main criticisms of the tool is that it doesn’t take into account the stuff that is really important in our lives, particularly levels of wellbeing. However, Gallup has now uncovered many aspects of wellbeing that correlate strongly with GDP per person.
The article continues with some detail about these different aspects which were tracked in Gallup’s polls. But it also reflects on studies of the previous global recession in 2009 which suggest that “economic hardship does indeed lead to emotional woe”.
It concludes with a sobering message. “The virus’s human toll is vast in terms of deaths and dollars. But given the correlation between GDP per person and Gallup’s measures of wellbeing, it may have an enduring impact on the world’s quality of life too”.

Author: Eileen Donnelly