Being Happy Pays Off

Edited by Jill Wright, 20 September 2013

I've been doing a lot of smiling since I read a story in The Age about a Sydney economist who decided  to measure the income-generating effects of happiness. 

No doubt because their field is generally  described as "the dismal science", economists are quite  obsessed with the commodity of happiness. They seem to be constantly casting  their slide rules over it.  

There's the Easterlin Paradox, for instance, which relates to the  effects of income on happiness internationally. For years, apparently,  economists have been furiously researching whether there is or isn't such a  paradox.  

Professor Satya Paul decided that since income  doesn't have a significant effect on happiness - I can't help but think that's  debatable - he would measure whether happy people were more productive than  others. The question that fascinated him was whether happy people could  increase their income generation through their attitudes to work.  

Using research from the Household, Income and Labour Dynamics in  Australia (HILDA) survey, Professor Paul established that happier people get  more done at work and are paid more.  

"We found happy people are more active, more productive and get  less upset by the work," he told a Fairfax reporter.  Professor Paul found that when other income factors such as age, education  and geographic location were the same, Australians who were most satisfied with  their life earned about $1766.70 a year more than people at the bottom of a  happiness scale of zero to 10. For every one point rise in happiness on this  scale, he found, a person's income rose by $176.67.  

As it happens, psychologists are obsessed with happiness too.

We  try to create more of it for our clients, and I have to say, with as much modesty as possible, that we are pretty good at it.  Now I am wondering whether perhaps psychologists  should be recognised for their contributions to productivity and national income.  When I think of all the amounts of $176.67 that our clients have amassed over  the years ...