Editor's note: Think money can't buy happiness? Behavioral economists Elizabeth Dunn and Michael Norton beg to differ. It actually can, they say—but only if we spend it the right way.
In their book released this week, Happy Money: The Science of Smarter Spending, Dunn and Norton draw on years of quantitative and qualitative research to explain how we can turn cash into contentment. The key lies in changing our spending habits and adhering to five key principles: Buy Experiences (research shows that material purchases are less satisfying than vacations or concerts); Make it a Treat (limiting access to our favorite things will make us keep appreciating them); Buy Time (focusing on time over money yields wiser purchases); Pay Now, Consume Later (delayed consumption leads to increased enjoyment); and Invest in Others (spending money on other people makes us happier than spending it on ourselves).
Happy Money provides valuable information not only for pleasure-seeking consumers, but also for companies looking to increase the happiness of both employees and customers. The following excerpt describes how the power of limited access led to fanatical demand of such products as McDonald's "McRib" sandwich and KFC's "Double Down." Read More
In their book released this week, Happy Money: The Science of Smarter Spending, Dunn and Norton draw on years of quantitative and qualitative research to explain how we can turn cash into contentment. The key lies in changing our spending habits and adhering to five key principles: Buy Experiences (research shows that material purchases are less satisfying than vacations or concerts); Make it a Treat (limiting access to our favorite things will make us keep appreciating them); Buy Time (focusing on time over money yields wiser purchases); Pay Now, Consume Later (delayed consumption leads to increased enjoyment); and Invest in Others (spending money on other people makes us happier than spending it on ourselves).
Happy Money provides valuable information not only for pleasure-seeking consumers, but also for companies looking to increase the happiness of both employees and customers. The following excerpt describes how the power of limited access led to fanatical demand of such products as McDonald's "McRib" sandwich and KFC's "Double Down." Read More
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