Comment by guylhem | Hacker News Reader

Comment by guylhem | Hacker News Reader

If your money doesn't buy you happiness, you are spending it wrong.

It's a well known fact that GDP per capita is well correlated with other indicators made by organisations with a liberal agenda, such as the HDI - so much that it is problematic both for these organisation, and for a usual neoliberal opinion (with diminishing marginal returns).

Maybe they are diminishing marginal returns with money - just like with human life, after the 1000th year we might get bored, but we don't see them because we look at a too small scale (a mere 75 years of life, with many disabilities in the end)

EDIT : As usual, I don't care for the downvotes down to -1, but instead of a lazy click, could you please take 10 seconds to expose facts if you want to refute my points?

Downvoting means "does not bring anything to the discussion", it does not means "I hate what you think". Facts please. Please bring me shame for how wrong I am, (with references if possible).

Until then, here are my references:

First hits on google : correlation between GDP per capita and HDI : "Human Development Index HDI is advanced as being a better indicator than GDP per capita... BUT look at a plot of the correlation between HDI and GDP/capita or all countries... There is today a very strong correlation"

http://www.gapminder.org/news/hdi-surprisingly-similar-to-gd...

"The concepts of diminishing marginal returns on money" in simpler terms on a blog: http://www.getrichslowly.org/blog/2010/06/16/the-marginal-ut...

Since you asked about an explanation: I downvoted you because your post makes no sense whatsoever.

>It's a well known fact that GDP per capita is well correlated with other indicators made by organisations with a liberal agenda, such as the HDI - so much that it is problematic both for these organisation, and for a usual neoliberal opinion (with diminishing marginal returns).

Why would that be problematic for those organizations?

Saying "GDP is correlated with happiness" (what you're saying) is a looong way from "Impact on GDP is the best metric for determining policy" (what would refute the 'liberal' GDP replacers).

HDI and others were created because it was said that GDP per capita was not measuring happiness well enough, and was too economic.

But now we realize they are correlated, which begs the questions : are the parts about education, healthcare etc. within the HDI so unimportants ? (ie why did bother creating the HDI if GDP/capita works just as well on most cases)

But if works so well, shouldn't we also see diminishing marginal returns in GDP per capita ? (in neoclassical theory, diminishing marginal returns are everywhere !)

Some studies have added ad-hoc trigger points (up to $75k and you'll be happy, then not so much) but still from what I get it's a weird situation, and we are still learning important facts about the utility of money. It's quite interesting.

EDIT: Marking normative suggestions with regards to GDP per capita - I don't think I would, cause that's quite a bit off my league. There are different models, and many variables - not one simple solution.

>why did bother creating the HDI if GDP/capita works just as well on most cases?

Because using GDP maximization to decide policy in those other cases results in lower overall happiness.

I would have no problem if economic policy-makers were content to merely correlate their decisions with increasing the GDP. Using it as the only end-goal, though, is foolish, and using it in those exceptional cases is, by utility maximization standards, evil.

> If your money doesn't buy you happiness, you are spending it wrong.

One of my all-time favorite papers: "If money doesn't make you happy, then you probably aren't spending it right" http://www.wjh.harvard.edu/~dtg/DUNN%20GILBERT%20&%20WIL...

If your money doesn't buy you happiness, you are spending it wrong.

True, but not everyone, or even everyone with plenty of money, has the opportunity to spend it rightly.

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