Th2.1: Real Incomes and Subjective Happiness

Question 1

What two things are positively related at low incomes?

Answer 1

happiness and income

i.e if you are poor and your income increases you will be happier

Question 2

What are high levels of income not associated with?

Answer 2

increases in happiness

e.g rich people gaining increase in income won’t make them as happy

Question 3

What is the Easterlin Paradox?

Answer 3

an increase in consumption of material goods will increase happiness if basic needs aren’t met (food and shelter), but once these needs are met, an increase in consumption won’t increase long term happiness

Question 4

What do income and happiness depend on?

Answer 4

depends on the people around us

Question 5

What is income directly linked to?

Answer 5

social status and a high social status tends to make one happier