Dow Jones Sinks

In this month’s posting for Positive Psychology News Daily, I reviewed some brand new research from Professor Carol Graham, Soumya Chattopadhyay, and Mario Picon (all from the University of Maryland). Their objective was to better understand the effects of the US economic crisis on well-being and to determine if individuals adapt both to the bad news of the crisis and then to the good news of potential recovery.

Looking across time during the crisis, not surprisingly happiness levels decreased markedly at the start of the crisis, reaching their lowest levels early in 2009. They then followed an equally marked upward trend after April 2009. During the downward trend, happiness levels lag the stock market spikes, which makes intuitive sense.

But the most striking result is that happiness levels lead the stock market on the upward trend. What’s more, by July 2009 happiness levels were above those at the start of the crisis, even though the Dow Jones was only just starting to recover, having hit rock bottom.

For the full posting and to read all the comments, see Positive Psychology News Daily.

Image  courtesy of Scorpions and Centaurs

Ice-cold beer - one of life's small pleasures

Another new study (Quoidbach et al, 2010 – see details below) has been published on the topic of money and well-being, specifically, whether being wealthy enough to access the best things in life affects your ability to savour small pleasures.

The research suggests that wealthier individuals report lower savoring ability, and even being reminded of wealth produces the same negative impact on savoring as actual wealth. In fact, you don’t actually need to enjoy any peak experiences (such as spending time on a tropical beach holiday) for your savoring ability to be impaired – simply knowing that these peak experiences are readily available may increase your tendency to take life’s small pleasures for granted.

For a full review of the research and its implications, see Positive Psychology News Daily.

Reference:

Quoidbach, J., Dunn, E.W., Petrides, K.V. & Mikolajczak, M. (2010). Money giveth, money taketh away: The dual effect if wealth on happiness. Psychological Science 21 (6), 759-763.

Image:

Cold beer courtesy of niel schubert

Here’s a link to my January contribution to Positive Psychology New Daily . Research just out suggests that how you spend your money affects your well-being, and that you’d be better off  (psychologically-speaking) by considering experiential purchases rather than material ones.  There are several reasons for this, for example, people tend to make unfavorable comparisons when they buy material goods, and the positive feeling you might get from buying them wears off very quickly. With experiential purchases, the feel-good factor lasts far longer.

Fortunately, if you’re a shopaholic, you may be able to fool youself into thinking about material purchases as if they were experiences, and in this way derive some longer-lasting benefit from them!

Image courtesy of Lauren Close

Here’s a link to a US radio show ‘To the point’, featuring Barbara Ehrenreich, author of  ‘Bright-sided: How the relentless promotion of positive thinking has undermined America‘ and Robert Biswas-Diener, a psychology instructor at Portland State University; they discuss the connections between Positive Psychology, happiness and positive thinking and health and the economy (you need to wind forward to 30 minutes to hear this part of the programme, although I recommend you listen to all of it if you have time).

I’m astonished that Ehrenreich links the current economic crisis to positive thinking; what about the role played by good old fashioned greed? Or lack of effective financial regulation? Or technology, which has enabled high-frequency trading (aka casino banking). Surely these are far more likely culprits. By blaming positive thinking we’re unlikely to take the action necessary to avoid the same thing happening again in the future.

There’s been a lot of negative press in positive psychology circles about Ehrenreich’s criticisms of positive psychology, but what I hadn’t appreciated until now was her suggestion that the provision of a welfare state in Scandinavian countries (and presumably also the UK) might be due to pessimistic thinking. And there was I thinking it was because we cared about our fellow beings.

And whilst I agree with her that the US should think long and hard about being 22nd on the list of happy countries, what she doesn’t then question is how this can be the case if America IS the land of positive thinking that she claims it is.

Thanks to Robert Biswas Diener for the link.

On Monday evening I heard Ed Diener (aka Smiley Professor of Psychology at the University of Illinois) present at the 4th European Conference on Positive Psychology in Croatia on the subject of Well-being on Planet Earth. Leaving aside the fact that Diener works for the Gallup Organisation, he presented some curious findings about the predictors of life satisfaction and positive and negative emotion, and the relevance for policy use.

Life Satisfaction vs Emotion

Diener’s ‘happiness formula’ is one of the most well-known in Positive Psychology:

Subjective Well-being (i.e. happiness) = Satisfaction with life + Positive Emotion – Negative Emotion.

This means that happiness is not a simple measure of how good you feel (emotion) but also includes a cognitive element of what you think about your life (satisfaction with life). Still with me? Great!

This explains why countries like Denmark can feature at the top of some happiness scales, but not others.

For example, when asked “on a scale of 0-10 how satisfied are you with your life?” Denmark comes top of the league table. But when you look at which countries are high in positive emotion, New Zealand, Honduras and Panama come at the top.

But happiness is even more complex than that – the presence of positive emotion is not the same thing as the absence of negative emotion (in the same way that health is not the mere absence of illness).

So countries which are high in positive emotion are not the same as those which are low in negative emotion (e.g. Denmark, Sweden and Australia).

Diener’s research with Gallup has also found that the top two predictors of satisfaction with life and positive emotion are not the same:

Predictors of satisfaction with life:
1. Money (as measured by GDP per capita)
2. Optimism
3. Whether I can count on other people

Predictors of positive emotion:
1. Whether I learned something yesterday
2. Freedom to choose
3. Whether I can count on other people

Relevance for Policy Use

According to the Gallup data, 94% of Danes score more then 8/10 for happiness, whereas 97% of Togolese score less than 3/10. Not surprisingly (because this is where Gallup’s interests lie), Diener used these extraordinary findings to argue that we should pay more attention to country-level well-being, since the way in which individual countries are run must be what makes the difference to these overall happiness scores. His suggestion is that societies would do well to use well-being measures in their creation of country-wide policies, as well as the more traditional economic and social measures.

It’s difficult not to disagree with him when you look at the data*; however, the question then arises as to whether it’s the government’s role to make people happy. My own perspective is the government does have a role to play in creating the right environment, although I think we could do a great deal more to improve people’s lives by spending the resources on treating mental illness effectively.

* Sadly the data Diener presented isn’t in the public arena since it belongs to the Gallup Organisation.