Lasting Wage Increases Can Improve Well-Being

Expanding the question of “Does money bring happiness?” a pair of researchers investigated how increased income and workload influenced overall life satisfaction. Their findings, published in the American Economic Journal, were clear: more money does make people happier — but only if there is a long-term increase in income. A temporary increase does not have any noticeable effect on an employee’s level of happiness, even if it is a large increase. By contrast, a permanent increase in income results in a significant rise in well-being, even if the raise is small.

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