Money alone can't make people happy

In The Pursuit of Happiness psychologist David Myers points out the surprising fact that in countries where nearly everyone can afford life's necessities, increasing affluence matters surprisingly little in terms of personal satisfaction.

The correlation between income and happiness is "surprisingly weak", as University of Michigan researcher Ronald Inglehart observed in one study covering 170,000 people in 16 countries. Once we have acquired life's necessities, more money provides diminishing returns.

Myers suggests that though we love our air-conditioners, camera cell phones, text messaging, Internet search engines and iPods, we are no happier than were our grandparents growing up without any of those things.

Gallup surveys reveal that in the decade after 1994, while telephones and television sets went from being uncommon to commonplace among households in China, satisfaction with life actually declined slightly.

If an improved economy is not necessarily our ticket to more satisfaction, what is?

Researcher Mihaly Csikszentmihalyi has found that what people enjoy most is being engrossed in a mindful challenge. Csikszentmihalyi calls it the optimal state flow, in which we become so absorbed in an activity that we lose consciousness of self and time. Thus, work and leisure that require total concentration of our skills promote happiness.

Myers writes: "We humans are social animals. We have a deep 'need to belong'. We, therefore, benefit from having loving companions through the journey of life, from having people with whom we can share our suffering and sorrow and our good fortune and celebration."

These findings are linked with others which indicate that happy people tend to have energy that is bred by regular aerobic exercise, sufficient renewing sleep and positive attitudes such as a sense of gratitude for one's health, friends and family.

Two years ago, Premier Wen Jiabao suggested to netizens in an online chat that the government must ensure an equitable distribution of social wealth. Wen said: "Distributing the cake of social wealth is a matter of being just and fair to everybody."

It is also equally true that people have a responsibility to straighten out their priorities. We can work to expand our personal wealth without biting off more than we can chew. Overindulgence leaves some people without anything and it also makes the gluttons sick. Money has a rightful place in our lives, not as a marker of our value or success, but as a tool to help enrich all our lives.

So, while the government should certainly work to help ensure an adequate standard of living for all to provide a baseline for an enjoyable life, it is imperative to remember that a nation's happiness ultimately depends on more than just material wealth.

The author teaches psychology at TOPU in Beijing and is an adjunct professor of law in the Temple University/Tsinghua University LLM program.