Actually, Buying Happiness Isn't Very Expensive

When it comes to buying happiness, turns out more is rarely more. Elizabeth Dunn studies consumer happiness for the University of British Columbia and joins host Liane Hansen to explain why buying a single chocolate truffle is more likely to make you happy than buying a box of 10 chocolates.

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LIANE HANSEN, host:

Imagine this scenario for a moment: You're at the checkout counter, and you have to choose between buying a single chocolate truffle, or a box of 10 chocolates. The box of 10 chocolates is on sale, and it's a better deal. You may think this is a no-brainer - go for the 10 chocolates. But when it comes to your happiness, the single chocolate truffle will most likely will make you happier.

So says Elizabeth Dunn. She's an assistant professor of psychology at the University of British Columbia, and she studies consumer happiness. She joins us from the studios there. Welcome to the program.

Professor ELIZABETH DUNN (Psychologist, The University of British Columbia): Thank you.

HANSEN: What kinds of purchases make people happy?

Prof. DUNN: Well, it turns out that one of the best things people can do is invest in experiences rather than in material things. So it may be better to treat yourself to an exciting concert or a little weekend getaway than to remodel your home.

HANSEN: Ah, okay. Are there other, concrete examples? I mean, have you seen this play out in your life?

Prof. DUNN: Yes. So I recently purchased a home with my fiance. And when we moved in, there were some ugly, old carpets. So we decided okay, let's tear those carpets out. But then we proceeded to spend weeks and weeks comparing maple to red oak to Brazilian cherry. We ended up spending about $10,000 putting in this hardwood flooring. And now, to be honest, the hardwood floor we put so much thought and money into is just the ground beneath our feet.

(Soundbite of laughter)

HANSEN: Ah. So ideally, then, what do you think you would rather have spent it on?

Prof. DUNN: Well, I think I have made some good spending decisions. So I spent some money last year to go on a safari in Africa. And those memories, I think, will be with me forever and matter more in sort of strengthening my connection with my fiance - with whom I was traveling - than any kind of material purchase I could make.

HANSEN: Why is it so difficult for people to figure out which purchases make them happy, and which don't?

Prof. DUNN: Well, it's a hard problem. Figuring out what makes us happy is not easy. You know, unless you have a researcher following you around and tracking your happiness and everything you do and entering it into complex statistical equations, it's not going to be easy to isolate whats really influencing your own happiness.

HANSEN: It's also interesting in terms of - let's say, leisure. When people purchase things for leisure activities, usually that is going to make them happy. However, I mean, whats the difference between just going out and buying, you know, some golf clubs because you like the game, and going out and buying, you know, the gold standard of golf clubs?

Prof. DUNN: I would say that the difference between not having a set of golf clubs, not being able to go out golfing, and then having a set of decent golf clubs you maybe bought off Craigslist, that allow you to get out on the green, will make a big difference.

But then, going from the pretty decent golf clubs to the really spectacular golf clubs, I would suggest, is unlikely to make as big a difference as people expect.

HANSEN: So you are finding that people aren't happy keeping up with the Joneses anymore?

(Soundbite of laughter)

Prof. DUNN: Keeping up with Joneses does not seem to be a particularly successful route to happiness.

HANSEN: Yeah. What about fashion? I mean, there are some that say, you know, why spend $400 on this bag when you could use that $400 and buy maybe a couple of outfits, and have some left over for a coffee?

Prof. DUNN: I would agree with that. Any one purchase, any one thing that we do is unlikely to provide us with lasting happiness. We adapt to things very, very quickly - much faster than most people realize. And so it probably is better to buy a bunch of nice, little things for yourself than to really indulge in one big purchase.

HANSEN: Did you find - if there was a correlation between the amount of money people spend on themselves, and the amount of money they spend on others, and which makes them happier?

Prof. DUNN: Right. What we have seen is that the amount of money that people spend on themselves is not associated with greater happiness, once you control for their income. In contrast, the amount of money that people spend on others is associated with greater happiness.

HANSEN: So in these times of less money, there is the potential for more happiness.

Prof. DUNN: I think if having less money pushes people to make better spending decisions, then less could be potentially be more.

HANSEN: So whats been your biggest indulgence that has made you happy?

Prof. DUNN: Hmm...

(Soundbite of laughter)

Prof. DUNN: Well, to me, I think often it's the little indulgences of daily life that can be most valuable. So on the way to work, I could've just had a quick cup of coffee. But instead, I thought, oh, you know, Im going to go get the frothy, foamy, delicious cappuccino that I really like, from my favorite coffee shop. It's a couple of dollars more but I really appreciate it, and it's a nice way to start my day.

And I would argue, having those nice cappuccinos in the morning is such a nice source of pleasure that it's worth not buying a brand-new car.

HANSEN: Elizabeth Dunn is an assistant professor of psychology at the University of British Columbia, and she joined us from the studios there. Thank you.

Professor DUNN: Oh, my pleasure. Thank you.

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