I recently read an interesting book about happiness. This book made me think seriously about what’s the purpose of life, and put myself other existential questions. Tonight we’ll talk about the relation between money and happiness. By the time I read this book I thought that the happiness grows linear with the money. I always thought that the richer, the better… Now I have a different opinion.

But one thing I know for sure: the lack of money brings unhappiness!

I’ll show you a chart drawn yesterday. It describes the relationship between the money and the happiness.

Happiness(Money) function

Happiness(Money) function

There are three ares in the chart, named 1, 2 and 3, delimited by 2 green lines. We can observe that we can approximate the first part of the chart with a linear function… this was the part I have always thought completely describes the happiness(money) function, maybe because as a kid I was situated in this part of the chart… and till now I haven’t imagine or haven’t had the occasion to imagine the whole “pie”. This particular area represents the poor people, people that an extra amount of money would make them happier, people who spend most of the salary on primary goods. People who don’t afford a holiday abroad or to eat at least once a week at the restaurant.

The second area of the chart represents the middle class. More money, fewer worries… In my opinion, the percent of people from a country within this category, gives the happiness of that country. If the most people from a country are situated in the second part of the chart, we have a happy country… else not…

The third part of the chart are the rich people. They have lot more money than the other two categories, but are not lot more happy… I think for all countries, the happiness(money) chart looks the same, except the values under the two green lines. Let’s take for example my country, Romania: I think under the first line I could put the value of 500E and after the second line the value 3000E, or Germany where I’d raise the first line to 1500E and the second to 4000…

I’ll continue with the happy country idea comparing two countries: one of the happiest on earth, Holland and one in the middle of the hierarchy, my sweet contry, Romania.

Let’s draw another chart, based on my perception of situation, not on some rigorous study:

Comparation between Romania and Holland based on income

Comparation between Romania and Holland based on income

There are two charts, one for every of the two countries: any of the two pies are split in three zones: every zone corresponds to the areas from the first chart. For example Zone 1 from the comparative chart, represents the poor people. Zone 2 from the “pies” represents the middle class etc.

We can easily see that most Romanian people are located in the first part of the comparative chart, and I can explain why: most of the people paid from the country’s budget have the income between 100E – 500E and of course the country is poorer than Holland. Sad thing, in this zone we can find social categories that in other countries are located in other zones, like doctors, teachers, book authors.

That’s one of the reasons that Holland is happier than Romania: in Romania, the number of people belonging to the first part of the chart is bigger than the number of people in other zones.

Finally advice to the government: if you want a happier country, try to move people from the fist section to the second, start with the social categories that don’t belong there!