Diminishing marginal returns
- The more money students have – the less happiness each additional pound (the marginal pound) will give.
- How much do you think you need each week to get to this point of diminishing marginal return?
- Your university reccomends
OUR ADVICE:
1. Money fulfils our basic needs BUT doesn’t achieve ultimate happiness. To gain happiness from other aspects of university life, consider: joining a society or a sports team.
2. Don’t compare yourself to others around you, your happiness is unique.
3. Don’t forget to appreciate and value your place at university as it’s only from living in a country with high standards of living that we have this opportunity available to us.
Easterlin Paradox
- The reason why our happiness stays relatively similar despite windfalls in income is due to:
a) Rivalry - we want things because other people have them – if others get better off, I need more to feel as good as before
b) Habituation - ‘the hedonic treadmill’ – as standards of living increase, we first love it, then get used to it, after which it makes little difference
- We only actually gain around 13% additional happiness in the long-run from a gain of income
"if we were better off we wouldn’t enjoy existing pleasures as much,
e.g. dinner at a nice restaurant with friends at the end of a week at uni isn’t as pleasurable if we can afford to do it every night"
"After a certain point – money won’t buy you any additional happiness."