Scientists living in one of America’s most expensive cities — San Francisco — have come to the conclusion that money can’t buy happiness.
But most people already know that. They just refuse to believe it. Rather than investing more to enjoy life experiences, many spend time and money to acquire material objects they believe to be tangible indicators of happiness, though always fleeting.
"People actually do know, and accurately predict, that life experiences will make them happier," San Francisco State University psychologist Ryan Howell, said in a statement. "What they really underestimate is how much monetary value they will get out of a life experience. Even though they're told experiences will make them happier and they know experiences will make them happier, they still perceive material items as being a better value."
As opposed to life experiences, which depend upon memory, material objects hang around to impart a tangible reminder of their financial value, often confused for happiness. "We naturally associate economic value with stuff. I bought this car, it's worth $8,000," Howell said. "We have a hard time estimating the economic value we would place on our memories."
In the study, Howell enlisted the help of student Paulina Pchelin to survey people making purchases in the local marketplace, documenting their impressions before and after the retail experience. Interestingly, many people told the researchers they thought money spent on an enjoyable life experience would bring happiness, but that material purchases made better financial sense. Only afterward came feelings of buyer’s remorse. Those surveyed later said they not only agreed that life experiences bring greater happiness, but also greater value.
"There were just huge underestimates in how much value people expected to get from their purchase," Howell said. "It's almost like people feel they will get no economic value from their life experiences and therefore they feel this tension in spending money on them."
The San Francisco State researchers then found that one’s spending behavior changes along with adjustments in attitude, perhaps toward a more new age, California feel. Study participants first asked to prioritize their true values tended to choose life experiences over material objects, but only when reminded thus. Like Dorothy in The Wizard of Oz, we know inherently that Kansas is but a state of mind.
However, Howell said he’d need to conduct further research to figure out how to sell his brand of happiness to the masses, the implications of which extend beyond psychology or retail. And lest you doubt, the study of happiness brings tremendous value to society.
"Companies want their employers to be happier because they are more productive. Doctors want their patients to be happier because they will be healthier,” he said. “We should try to figure out how to help people maximize their happiness because of all the benefits that come from it."
Source: Howell, Ryan T., Pchelin, Paulina. The Hidden Cost of Value-seeking: People do not Accurately Forecast the Economic Benefits of Experiential Purchases. Journal of Positive Psychology. 2014.