George Monbiot has a fascinating column in the Guardian in which he links to research suggesting materialism as a cause of loneliness and unhappiness. Shopping for shopping’s sake, or in search of status, tends to make people miserable.
It is a great column but Monbiot gets it wrong at the end:
This is the dreadful mistake we are making: allowing ourselves to believe that having more money and more stuff enhances our wellbeing, a belief possessed not only by those poor deluded people in the pictures, but by almost every member of almost every government. Worldly ambition, material aspiration, perpetual growth: these are a formula for mass unhappiness.
As best we can tell (also here; and see here for some debate) as countries as a whole become more wealthy, they become happier. This is most strongly felt at low levels of wealth and the effect weakens in wealthier countries, yet the effect still seems to be present even among wealthier countries.
When the unit of analysis becomes people not countries, within wealthy countries the best available evidence suggests that, up to a point (and this point is quite high) more money makes you happier, beyond the point it does not. Technically this is known as satiation, and while satiation seems to exist for self-assessed happiness, it does not seem to be present in other self-assessment based quality of life measures. Using these, more money continues to be associated with higher life assessments as far up as the data go — although diminishing returns exist, it takes more money to bring the same amount of quality of life improvement when you already have a lot of money.
Money, however, is not materialism — you could have a wealthy society without being materialistic. In it we’d be wealthy thanks to technology, good institutions, and high levels of human capital, but we’d be spending our money on leisure, and our time with family and friends, and in the outdoors or in libraries, not in shops. And, for what it’s worth, this is what I think the end goal of development out to be. Prosperous, peaceful countries which afford their citizens health, education and free time. As well as freedom from advertising driven myths about needing to own more. Countries where people are wealthy and where people still keep shopping, but where wealth and markets are a means to an ends — the good life.