I often hear the phrase, “money can’t buy happiness.” Generally, people who disagree with this statement are likely to define or base their happiness on the quantity/qualities of their material possessions. As someone who dreams of one day being able to afford a mansion in Malibu, I was one of these people. I agreed with the aforementioned logic until last summer when I watched Michael Norton’s Ted Talk, “How to Buy Happiness.”
To view the video yourself, click here!
Michael Norton is a Professor of Business Administration at the Harvard Business School and a leader of the university’s Behavioral Insights Group. He has organized multiple experiments testing out the theory that money can buy happiness if you spend it right. What he means by this is that spending money on others and/or using it to serve your community will inherently make you happier. He defines this logic as pro-social spending, where individual spending is rewarding for both parties (the spender and their recipient/s).
His research recognized a universal pattern where people who spend money on others (ex: buying someone dinner or donating to a non-profit) feel notably happier about themselves and their purchases than people who spend money selfishly (ex: buying yourself new clothes). The happiness of spending money on others comes from aligning charitable efforts with personal core values. Simply put, it feels good to make a difference for the people or causes you care about.
– Jenna Eisenberg, Research and Consulting Coordinator