The Easterlin paradox is one of those concepts that sits at the intermediate point between psychology and economics, on the border between the two disciplines. Strange as it may seem, these two sciences are increasingly encountered, with some points in common. One is the idea, that links having money and the ability to consume happily.
No one can deny the importance of money. We have always heard, many times in life, that money does not bring happiness, but many times we are also frustrated that we do not have enough money to buy what we want: a trip, a course, a quality medical service. Etc.
“You have to have little appetite to savor the fortunes of the rich. ” – Count of Rivarol-
Easterlin’s paradox reinforces precisely the idea that having money and being happy are not two necessarily related realities. The value we gain influences many aspects of our lives, but this influence is relative. Let’s look at this interesting idea in detail below.
The Easterlin paradox was created by the economist Richard Easterlin, his first reflection took place at a global level, describing a reality that many of us know: the countries with the greatest economic benefit are not the happiest, in addition, the low-income countries are not happy either. . the most dissatisfied.
This point, supported by research and evidence, contradicts the widespread idea that those with more money are happier. The first question that arose was: Do people experience a limitation on their ability to be happy after reaching a certain level of income?
Another aspect of the Easterlin paradox is that the result is different if we talk only about one country, that is, if we compare income differences within each country, the results indicate that people with less profit are less happy and vice versa. How do I explain it?
To explain all these observations, Easterlin appropriated a metaphor no less than Karl Marx: he once said that if a person has a house that meets all his needs, he can already feel satisfied; However, if someone next to this house builds a sumptuous castle, they will begin to perceive their house as if it were a masure.
To this end, Easterlin drew two conclusions. The first is that people with higher incomes also tend to be happier. The second, that people perceive their income as “high” based on the income of the people around you. This would explain the difference in the relationship between happiness and internal and external income. outside countries.
Therefore, the Easterlin paradox says that the perception of our well-being is directly conditioned by the comparison we make with the people around us. In other words, context is decisive whether someone’s economic gain brings happiness or not.
Richard Estearlin never directly argued that higher or lower income was the cause of feelings of happiness or misfortune, what Estearlin’s paradox says is that a not necessarily greater economic gain does not create a greater sense of happiness, it depends on the context in which a question then arises: what generates happiness or unhappiness, so it could be equality and inequality , and not so much the economic income itself?
In other words, is it possible to think, from Estearlin’s paradox, that large income differences within a society are a source of unrest?In conditions of great inequality, being above others can lead to a feeling of greater satisfaction with life. On the contrary, feeling inferior to others would create a greater sense of frustration and sadness.
Nor in any case does the issue have to do directly with meeting needs, that is, my income can allow me to live without major difficulties, but if I realize that others live much better than me, I will feel that I am not earning enough.
This is probably what happens in richer countries, as much as most people see their needs met, both wealth inequality and large economic elites have overshadowed the feeling of happiness and satisfaction of others. in poor countries where most have a low income level, it may be easier to see happiness flourish.