Does Economic Growth Improve Human Morale?

Passage 9
Does Economic Growth Improve Human Morale?
During the mid-1980s, my family and I spent a sabbatical year in the historic town of St. Andrews, Scotland. Comparing life there with life in America, we were impressed by a seeming disconnection between national wealth and well-being. To most Americans, Scottish life would have seemed Spartan. Incomes were about half that in the U.S. Among families in the Kingdom of Fife surrounding St. Andrews, 44 percent did not own a car, and we never met a family that owned two. Central heating in this place not far south of Iceland was, at that time, still a luxury.
In hundreds of conversations during our year there and during three half summer stays since, we repeatedly notice that, despite their simpler living, the Scots appeared no less joyful than Americans. We heard complaints about Margaret Thatcher, but never about being underpaid or unable to afford wants. With less money, there was no less satisfaction with living, no less warmth of spirit, no less pleasure in one another’s company.
Are Rich Americans Happier?
Within any country, such as our own, are rich people happier? In poor countries, such as Bangladesh and India, being relatively well off does make for somewhat better off. Psychologically as well as materially, it is much better to be high caste than low caste. We humans need food, rest, warmth, and social contact.
But in affluent countries, where nearly everyone can afford life’s necessities, increasing affluence matters surprisingly little. In the U.S., Canada, and Europe, the correlation between income and happiness is, as University Of Michigan researcher Ronald Inglehart noted in a 1980s 16-nation study, “surprisingly weak (indeed, virtually negligible).” Happiness is lower among the very poor. But once comfortable, more money provides diminishing returns. The second piece of pie, or the second $50,000, never tastes as good as the first. So far as happiness is concerned, it hardly matters whether...