Money Cannot Bring True Happiness

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The pursuit of happiness and the pursuit of money have become synonymous in most modern societies, especially given the pervasive nature of capitalism. Materialism has become the guiding philosophy hinged on the assumption that more money is strongly correlated with increasing happiness. This perspective could be true when looked at from the angle of the debilitating effects of poverty. The line between life satisfaction and emotional wellbeing (true happiness) is blurred, and this aspect has led to the misconstrued conclusion that money could buy happiness. However, there is a huge difference between true happiness or emotional wellbeing and being satisfied with life, specifically based on the things that money can afford. Therefore, it is important to delineate the two aspects of subjective wellbeing and understand the role of money in both cases. This paper uses peer-reviewed evidence to show money cannot buy true happiness because this attribute is subject to various factors including genetics and other exogenous and endogenous aspects.

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Understanding True Happiness

The question of the role of money in bringing happiness has become an interesting point of academic inquiry in different disciplines of study. Economists seek to understand how money as a determinant of individual life satisfaction weaves into the ultimate state of happiness in people. With such information, economists could explain various economic influences in human life, such as income distribution, inflation, and unemployment among other related attributes. On their part, psychologists want to assess the relationship with monetary gains with mental health. However, to understand the place of money in happiness, it is important to have a clear interpretation of what true happiness means.

There are two underlying concepts that emerge when discussing happiness – life satisfaction and emotional well-being. According to Kahneman and Deaton (2010), emotional wellbeing, which is also referred as experienced happiness or hedonic well-being, is “the emotional quality of an individual’s everyday experience—the frequency and intensity of experiences of joy, fascination, anxiety, sadness, anger, and affection that make one’s life pleasant or unpleasant” (p. 16489). On the other hand, life satisfaction is the holistic evaluation of a person’s life going beyond the current level of happiness. The problem with defining and delineating true happiness and life satisfaction arises because scholars have been designing surveys to measure life satisfaction, which is erroneously interpreted as happiness. Kahneman and Deaton (2010) argue that the commonly used question in these surveys is “How satisfied are you with your life as a whole these days?” (p. 16489). This question would be misleading if taken in the context of measuring true happiness. Therefore, with this understanding, it is now possible to analyze whether money brings true happiness or life satisfaction.

Money and True Happiness

The conventional understanding among most people is that more money would bring more happiness. However, available scientific research shows that money does not bring true happiness in the long term. It hurts to live in poverty and the affected individuals cannot experience happiness when they are constantly worried about where their next meal will come from or how they will give their children a decent livelihood. Therefore, people living below the poverty line will certainly be happier if they were given more money. This assertion is logical because such individuals would be relieved of the stress and mental anguish of having to live under poverty. In other words, the lack of happiness experienced by persons living under the poverty line is caused by the absence of material goods that are needed for day-to-day living. Therefore, the role of money, in this case, is to provide such materials, which are directly related to the state of happiness. In other words, if the affected individuals were provided with food, shelter, clothing, and other basic needs, they would still be happier because the cause of their unhappiness has been addressed.

Therefore, it suffices to argue that money in and by itself has no inherent value. It derives value from its various characteristics, such as being a measure of value, means of exchange, or unit of accountability. As such, the inherent value of money lies in the goods and services that it could purchase. Consequently, money is a means to an end, not the end itself. Referring to the case of people living under the poverty lines, it could be erroneous to claim that money brought them happiness. On the contrary, the plausible argument could be that the materials that the money bought brought happiness to the individuals in question.

However, even assuming that money has inherent value, it cannot bring or buy true happiness. In economics, money is said to have diminishing marginal utility – as money increases, the level of happiness derived does not increase in tandem. In the long-term, increasing income and wealth produce minimal happiness levels; hence, the concept of diminishing marginal utility of money in terms of happiness. The example of individuals living under the poverty line could give a clear illustration of this argument. For instance, increasing the income levels of the poor to get them out of poverty would be directly proportional to the level of happiness created. However, once the basic needs have been catered for, any additional increment in income or earnings would not elicit an equivalent level of happiness. In other words, if a graph were constructed with income plotted against happiness, the curve would flatten at one point.

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This concept could be understood better using Maslow’s hierarchy of needs model, which indicates that the importance of human needs is varied. A study conducted to establish the relationship between income and happiness by Drakopoulos and Grimani (2017) found that once a “level of labor earnings that satisfies the basic needs has been reached, further changes of labor earnings do not provide analogous changes on happiness levels because secondary needs come into the picture” (p. 25). Above the poverty line, basic needs (physiological and safety needs) are taken care of and the hierarchy progresses to the psychological needs of belongingness, love, and self-esteem. Another study by Lane (2000) arrived at the same conclusion that money has diminishing marginal utility in the context of bringing true happiness. In the study, Lane (2000) found that when compared with money, companionship created higher levels of social wellbeing. In other words, while money could buy tangibles, which are closely related to life satisfaction, companionship is concerned with creating true happiness, which cannot be purchased.

In another study, Kahneman, and Deaton (2010) concluded that while high income improves life evaluation or satisfaction, it does not have the same effects on emotional wellbeing in the long-term. This study relied on 450,000 responses of individuals concerning their level of income and state of happiness, and with this large sample size, the results could be generalized in different set-ups. The results showed that for individuals with an annual household income of over $75,000, giving them more money elicited little or no happiness (Kahneman & Deaton, 2010). Therefore, for a family with a household annual income of $30,000, giving them an extra $30,000 would bring more happiness as compared to adding the same amount to a counterpart with a $70,000 annual income. Kahneman and Deaton (2010) concluded that high income “buys life satisfaction but not happiness and that low income is associated both with low life evaluation and low emotional well-being” (p. 16489). From these arguments, it is clear that money cannot buy true happiness. It can only alleviate suffering and mental distress associated with poverty and once that problem has been solved, increasing wealth has diminishing happiness returns.

The issue of the relationship between money and happiness could be investigated from the perspective of immigration. In most cases, people leave the countries of their origins because they hope for a better life and future in their countries of destination. For instance, immigrants from Africa to Europe or North America assume that life in these countries is highly satisfying and with numerous opportunities, they could find happiness. Therefore, data on immigrants’ experiences in their countries of destination could be useful in understanding happiness in this context. Gatina (2016) sought to investigate whether money buys happiness by assessing the financial and general wellbeing of immigrants in Australia. The results of this study indicated that income has a “positive effect on immigrants’ well-being only during their first years in Australia…As time passes, the life satisfaction of immigrants also tends to increase, and after living 20 years in Australia, it becomes equal to the life satisfaction of other Australians” (Gatina, 2016, p. 92). A similar study by Calvo and Cheung (2018) focused on immigrants within the international sphere and arrived at the same conclusion. These findings are consistent with the diminishing marginal utility of money in the context of bringing true happiness.

At the global level, the available evidence shows that money cannot buy happiness. Geppert (2019) found that across various countries, increasing levels of income are associated with rising happiness to a certain level after which the returns become diminishing. Drakopoulos (2008) argues that there “is a common empirical finding in many countries that substantial increases in real per capita income do not correspond to equivalent increases of individual happiness” (p. 303). Therefore, it is clear that the principle of money having diminishing happiness returns in the long-term is not situational or unique to certain geographical areas. It thus suffices to argue that money is one component of what facilitates happiness, but not the only contributing factor.

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The Role of Genetics in Happiness

With the realization that money cannot buy happiness, scholars have turned their focus to investigating the role of genetics in happiness. Over the last decade, the field of genetics has evolved significantly, especially with the emergence of novel technologies that could analyze human genomic material and study how it relates to various human attributes. A study by De Neve, Christakis, Fowler, and Frey (2012) sought to explore how genes influence subjective wellbeing using a twin design and genetic association study. Specifically, this study focused on understanding the relationship between 5-HTTLPR, which is the serotonin transporter gene, and life satisfaction (De Neve et al., 2012). Initial results found that individuals with “the longer, transcriptionally more efficient variant of this genotype report greater life satisfaction (n=2,545, p=0.012)” (De Neve et al., 2012, p. 1). These findings imply that some individuals are genetically programmed to be happy, and thus with or without money, they will be happy. Similarly, those without the right genetic make-up for happiness, they will not experience high levels of the same despite the amount of money and wealth that they can accumulate.

Results from another study by Schnittker (2008) support the findings by De Neve et al. (2012). According to Schnittker (2008), “many putative indicators of the environment are highly heritable and, indeed, that the same genes that affect the environment may affect happiness as well” (p. 233). In this case, the heritability of happiness stands at 45 percent. Blum et al. (2009) give a list of genes associated with happiness including DRD2, 5HT2A, ANKK1, OPRK1, OPRM1, COMT, SLC6A3, HTR3B, NOS3, PPARG, ChREBP, FTO, TNF Alpha, MANEA, Leptin OB, PEMT, MAO-A, CRH, ADIPOQ, STS, VDR, DBI, GABRA6, GABRB3, and MTHFR among other related genes. Other studies such as Dfarhud, Malmir, and Khanahmadi (2014) and Rotenberg (2013) support the argument that a significant portion of happiness is heritable, and thus money plays a marginal role in bringing happiness.

Counterarguments and Rebuttal

However, despite the overwhelming evidence that money cannot bring true happiness, critics will argue in the opposite direction. They will claim that the world and human life are materialistic, and thus those with money are happier as compared with their counterparts without it. However, based on the arguments highlighted throughout this paper, it is clear that such an argument is simplistic as it fails to account for the diminishing marginal utility in the context of bringing happiness. The empirical evidence provided in this paper is robust enough to show that money cannot buy happiness in the long term. Nevertheless, critics of this assertion could be understood given the thin line between life satisfaction and emotional or hedonistic wellbeing. The majority of people supporting the idea that money can buy happiness confuse it with life satisfaction. As such, the point of contention lies in the definition of the two aspects of subjective well-being. In addition, such proponents view money objectively, as an end in itself, as opposed to being a means to another end.


The modern world is materialistic as the defining principle of capitalism. Consequently, most people confuse life satisfaction derived from material things with true happiness. However, as shown in this paper, the two terms are different concepts. Hedonistic well-being, which is synonymous with true happiness, cannot be measured using monetary value. It is an intrinsic element associated with feelings of love, joy, anger, stress, sadness, self-esteem, and other intangible human attributes, which could not be bought with money. This paper has shown that money has diminishing marginal utility in the context of creating happiness. The poor will be happier to get more money to a certain point when their basic needs have been addressed. Additionally, genetic materials have been shown to influence happiness. Therefore, in the presence of this overwhelming empirical evidence, it suffices to conclude that money cannot bring true happiness.


Blum, K., Chen, A. L., Chen, T. J., Bowirrat, A., Downs, B. W., Waite, R. L.,… & Rhoades, P. (2009). Genes and happiness. Gene Therapy and Molecular Biology, 13, 92-129.

Calvo, R., & Cheung, F. (2018). Does money buy immigrant happiness? Journal of Happiness Studies, 19(6), 1657-1672.

De Neve, J. E., Christakis, N. A., Fowler, J. H., & Frey, B. S. (2012). Genes, economics, and happiness. Journal of Neuroscience, Psychology, and Economics, 5(4), 1-27.

Dfarhud, D., Malmir, M., & Khanahmadi, M. (2014). Happiness & health: The biological factors- systematic review article. Iranian Journal of Public Health, 43(11), 1468–1477.

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Drakopoulos, S., & Grimani, K. (2017). Labor earnings reductions, happiness levels, and needs hierarchy. International Journal of Wellbeing, 7(1), 23-29.

Gatina, L. (2016). Does money buy happiness? Financial and general well-being of immigrants in Australia. Journal of Behavioral and Experimental Economics, 63, 91-105.

Geppert, K. (2019). Does money buy happiness? A cross-country look at the relationship between income and happiness. Issues in Political Economy, 28(2), 102-121.

Kahneman, D., & Deaton, A. (2010). High income improves evaluation of life but not emotional well-being. Proceedings of the National Academy of Sciences of the United States of America, 107(38), 16489-16493.

Lane, R. E. (2000). Diminishing returns to income, companionship–and happiness. Journal of Happiness Studies, 1(1), 103-119.

Rotenberg, V. S. (2013). “Genes of happiness and well-being” in the context of search activity concept. Activitas Nervosa Superior, 55(1-2), 1-14.

Schnittker, J. (2008). Happiness and success: Genes, families, and the psychological effects of socioeconomic position and social support. American Journal of Sociology, 114(S1), 233-259.

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PsychologyWriting. (2022) 'Money Cannot Bring True Happiness'. 15 January.


PsychologyWriting. 2022. "Money Cannot Bring True Happiness." January 15, 2022.

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PsychologyWriting. "Money Cannot Bring True Happiness." January 15, 2022.