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Easterlin Paradox in Leonhardt’s Article Essay


In his article entitled “May Be Money Does Buy Happiness After All” a critical writing in the New York Times, David Leonhardt contends the significance of Easterlin theory in elucidating the absence of a relationship between economic growth and happiness. The contention holds that money significantly contributes to individual happiness. On the contrary, Easterlin paradox indicates that human satisfaction level adjusts with increased income up to a certain level where additional money does not contribute to a higher level of happiness.

Qualification, Experience, and Credentials

David Leonhardt is an expert writer who has carved a niche in corporate scandals, culture, travel, and sports. He pursued his college education at Yale University and became a writer of the New York Times weekly column on political, policy, and economic scenes for over two decades. He has vast experience as a writer for The Washington Post and Business Week. He won UCLA’s Gerald Loeb Prize in 2004 and competed for Pulitzer Prize in 2002 writing on corporate scandals.

Credibility of the Author

David Leonhardt has a substantial edge to write about the relationship between economic growth and happiness given his credible experience as a writer in social experiences and an author of The Get Happy Workbook, which is a book that guides people on how to achieve happiness. His spirited interest in the social welfare has influenced debate on the effect of income on individuals’ happiness.

Article Summary

The article disputes Easterlin theory line of thought that there is no guaranteed positive attainment of happiness, whether linked to an individual or country’s improved economic status. The theory receives much credit from a singled case study on Japan’s economic growth after the Second World War in which the Japanese population was not entirely satisfied despite a huge milestone in the economic growth. A case study of a single target population has low external validity and limits generalization of results to the entire population. Happiness is a factor of self-fulfilling desire and the ability to meet the basic needs determined by the accessibility of goods and the value attached to individual needs (Stanca & Veenhoven, 2015). Therefore, the implication is that happiness is multifaceted and a product of several variables not limited to the financial status but attached to individual preference on a scale of needs. The needs satisfaction level of several individuals varies and thus is their happiness despite their economic situation. On the contrary, David Leonhardt believes that money buys happiness according to the rebuttal of Easterlin paradox by Stevenson and Wolfers who provided world survey data to support their argument.

Agreement with Support Strategies

Easterlin theory is self-deficient as it does not provide the scope of the research conducted, sample population, and overall validity of the research design. The validity of Easterlin theory relies on a single case study of Japanese citizens. The study was conducted immediately after the Second World War with possible confounding variables that demand further research. In his argument, Easterlin paradox claim that people in the underdeveloped countries were happy on hitting the threshold to satisfy their needs is a flawed comment as it generalized the happiness index of countries and failed to characterize different levels of satisfaction and happiness on an individual. Easterlin research only accounted for individual citizen’s happiness, but it failed to take a comparable analysis of satisfaction between and amongst different countries of the world. The process of data collection in the survey of Japanese citizens changed over time and presented some bias as the questionnaires’ items had changed.

The case study of Japanese citizens that support Easterlin paradox do not factor in the confounding psychological effects of the Second World War on the entire population and the country. Stanca and Veenhoven (2015) conclude that the value attached to human needs and life determines individual happiness. Thus, at the time of the Japanese poll, the aftermath of the world war had a likely negative effect on citizens’ value attached to needs and life that affected the poll results. Additionally, current data indicating the effects of income on happiness do not support the Easterlin theory. Moreover, no other research surveys support Easterlin theory except the Japanese poll. Easterlin claim on the happiness bar focused on attitude towards competing interests on the level of income among individuals. Besides, the theory failed to differentiate the relationship between economic growth and happiness. Consequently, based on the ability to satisfy their basic needs, people in the developed countries are happier when compared to people in the underdeveloped countries.

Evidence to Support Agreement

In the article, David Leonhardt indicates a flaw of Easterlin data collection in the Japanese case study. Leonhardt (2008) cites irregularity in the survey as “the question had changed over the years” (p. 401). The irregularity of the questionnaires indicates a biased approach of the survey as research instruments changed over the years from a subtle general approach to a complete satisfaction model. The prototype reflects a biased data collection that reduced the percentage of satisfaction justifying Easterlin conclusion detailed in the Japanese case study. The sample population of Easterlin study is one population within one geographical location and does not cut across the entire human race. The population size and region is not adequate to represent the world population given different socio-economic cultures and beliefs.

The new contradicting study to Easterlin paradox utilized the global survey methodology. The methodology incorporated the sample of the entire world population to make a representation of each geographical location. The data collected provides valid results that represent the population of each country. In this case, the scope of sample selection and study area is wider and increases the external validity of the findings. The findings of the new survey also cite extra information from other world surveys done after Easterlin publication. Additionally, the recent research approach of data collection had it basis on time series, “but it is more consistent with our story than his” (Leonhardt, 2008, p. 402). These findings add to the validity of the new findings and conclusion.

Leonhardt’s claim that the level of income matters in determining happiness receives support from various studies. He provides a global survey analysis on satisfaction by Stevenson and Wolfers, indicating “that people in richer countries are more satisfied” than in the poor countries (Leonhardt, 2008, p. 401). The global survey enhances the generalizability of the findings as it covers the entire world population and encompasses several studies done in different periods. Additionally, Leonhardt’s idea receives much support from Stanca and Veenhoven (2015) who claimed that money increases the ability to access products and enhance one’s level of satisfaction. Capacity to access goods and services means that individuals can satisfy their needs and wants. Thus, as income increases, capacity to acquire certain goods or pay services increases, resulting in increased satisfaction and happiness. The premise is that 80% the European countries studied support this claim.

In essence, consumption determines comfort that directly influences the level of satisfaction and happiness. High level of economic development associated with developed countries, thus, provides a wider accessibility to different goods and services, in contrast to underdeveloped nations. The ability to access daily needs that include relevant healthcare services and entertainment increases the level of happiness of individuals in the developed nations compared to the underdeveloped countries. According to Leonhardt (2008, p. 402), “economic growth can also pay for investments in scientific research that lead to longer, healthier lives.” The validity of the global statistical survey analysis provided by David Leonhardt indicates that people in the developed countries are happier than the ones in the underdeveloped nations. Furthermore, the global survey shows that satisfaction in the United States has not increased in the same proportion as in other developed nations. Hence, “a big reason it may not have risen in the United States is that the hourly pay of most workers has not grown much recently” (Leonhard, 2008, p. 402). Based on the global survey that increases the external validity of the results compared to Easterlin theory, it is pertinent to conclude that a strong direct relationship exists between individual income and the level of happiness.


The assertion by David Leonhardt that income determines the happiness of an individual is not far-fetched, for it holds a higher percentage of truth. The claim opposes Easterlin paradox that indicated no relationship between income and happiness. Unlike, Easterlin theory, the conclusion is a result of new data findings of global world survey. The general representation of the world population by the inclusive survey of all geographical locations in the new study revealed an increase in satisfaction associated with economic growth. The level of consumption and the ability to pay for services increase the happiness index. Thus, increased income increases capacity to pay for goods and services, and consequently, enhance life satisfaction and happiness. Therefore, David Leonhardt concludes that integration of happiness, as a product of income, is relevant.


Leonhardt, D. (2008). Maybe money does buy happiness after all. In a scanned book (pp. 399-403).

Stanca, L., & Veenhoven, R. (2015). Consumption and happiness: Introduction to this special issue. International Review of Economics, 62(2), 91-99. Web.

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"Easterlin Paradox in Leonhardt's Article." IvyPanda, 16 Sept. 2020, ivypanda.com/essays/easterlin-paradox-in-leonhardts-article/.

1. IvyPanda. "Easterlin Paradox in Leonhardt's Article." September 16, 2020. https://ivypanda.com/essays/easterlin-paradox-in-leonhardts-article/.


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IvyPanda. 2020. "Easterlin Paradox in Leonhardt's Article." September 16, 2020. https://ivypanda.com/essays/easterlin-paradox-in-leonhardts-article/.


IvyPanda. (2020) 'Easterlin Paradox in Leonhardt's Article'. 16 September.

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