At least up to a point.
People's emotional well-being - happiness - increases along with their income up to about $75,000, researchers report in Tuesday's edition of Proceedings of the National Academy of Sciences.
For folks making less than that, said Angus Deaton, an economist at the Center for Health and Wellbeing at Princeton University, "Stuff is so in your face it's hard to be happy. It interferes with your enjoyment."
Deaton and Daniel Kahneman reviewed surveys of 450,000 Americans conducted in 2008 and 2009 for the Gallup-Healthways Well-Being Index that included questions on people's day-to-day happiness and their overall life satisfaction.
Happiness got better as income rose but the effect leveled out at $75,000, Deaton said. On the other hand, their overall sense of success or well-being continued to rise as their earnings grew beyond that point.
"Giving people more income beyond 75K is not going to do much for their daily mood ... but it is going to make them feel they have a better life," Deaton said in an interview.
Not surprisingly, someone who moves from a $100,000-a-year job to one paying $200,000 realizes an improved sense of success. That doesn't necessarily mean they are happier day to day, Deaton said.
The results were similar for other measures, Deaton said. For example, people were really happier on weekends, but their deeper sense of well-being didn't change.
Kahneman, a Nobel Prize winning psychologist, and Deaton undertook the study to learn more about economic growth and policy.
Some have questioned the value of growth to individuals, and Deaton said they were far from definitively resolving that question.
But he added, "Working on this paper has brought me a lot of emotional well-being. As an economist I tend to think money is good for you, and am pleased to find some evidence for that."
Overall, the researchers said, "as in other studies of well-being, we found that most people were quite happy and satisfied with their lives."
Comparing their life-satisfaction results with those of other countries, the researchers said the United States ranked ninth after the Scandinavian countries, Canada, the Netherlands, Switzerland and New Zealand.
The research was supported by the Gallup Organization and the National Institute on Aging.