Social Indicators Research

, Volume 87, Issue 1, pp 65–82 | Cite as

Money Does not Buy Happiness: Or Does It? A Reassessment Based on the Combined Effects of Wealth, Income and Consumption

  • Bruce HeadeyEmail author
  • Ruud Muffels
  • Mark Wooden


The paper uses household economic panel data from five countries—Australia, Britain, Germany, Hungary and The Netherlands—to provide a reassessment of the impact of economic well-being on happiness. The main conclusion is that happiness is considerably more affected by economic circumstances than previously believed. In all five countries wealth affects life satisfaction more than income. In the countries for which consumption data are available (Britain and Hungary), non-durable consumption expenditures also prove at least as important to happiness as income.


Happiness Wealth Income Consumption Panel data 


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Copyright information

© Springer Science+Business Media B.V. 2007

Authors and Affiliations

  1. 1.Melbourne InstituteUniversity of MelbourneParkvilleAustralia
  2. 2.Tilburg UniversityTilburgThe Netherlands

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