2008) “Economic Growth and Subjective

ABSTRACT The “Easterlin paradox ” suggests that there is no link between a society’s economic development and its average level of happiness. We reassess this paradox, analyzing multiple rich datasets spanning many dec-ades. Using recent data on a broader array of countries, we establish a clear positive link between average levels of subjective well-being and GDP per capita across countries, and find no evidence of a satiation point beyond which wealthier countries have no further increases in subjective well-being. We show that the estimated relationship is consistent across many datasets and is similar to that between subjective well-being and income observed within countries. Finally, examining the relationship between changes in subjective well-being and income over time within countries, we find economic growth associated with rising happiness. Together these findings indicate a clear role for absolute income and a more limited role for relative income comparisons in determining happiness. Economic growth has long been considered an important goal of eco-nomic policy, yet in recent years some have begun to argue agains