Don't Produce, Be Happy

Whether you're on the left or the right, on one thing we can agree: America truly is an exceptional country. We spend the most on our military, hitting almost one trillion dollars in military spending in 2024. We spend the most on healthcare per capita, even though our average life expectancy is slightly less than it is for folks in Saudi Arabia, which spends a fraction of what we do.

In spite of all of this expenditure on health and defense, life expectancy isn't the only metric that's lagging behind other countries. American happiness has decreased as well. That's according to the World Happiness Report, which for years has measured a country's happiness by sampling its population and asking people to rate their current life using the Cantril scale. The scale goes from 0 to 10, where 0 is the worst possible life someone can imagine for themselves, and 10 is the best.

If we look at a rolling three-year average of how the US has scored, it's not looking good. This aggregate metric has fallen by 4% since 2014. Our absolute ranking among all nations has also fallen significantly; this is both because other countries have increased their happiness over time, and because others have not dropped as much as America.

They say that money can't buy happiness, but surely it can get closer than what we're seeing here, can't it? What gives?

Happiness Regressions

Part of this may have to do with a well-known fact that billionaires would be wise to remember: money, like any other resource, has a diminishing marginal value. The more of a thing you have, in general the less valuable each additional one of those things is to you.

And when it comes to nations, this certainly seems to be true for money. Here's a chart of GDP per capita vs that same happiness score from the table above, expanded to 127 countries where there's data from 2014 through 2025:

There are some definite trends here. In general, the higher a country's GDP, the higher the life satisfaction of its citizens. But in particular, this relationship is not linear: every dollar increase in GDP does not yield a commensurate rise in happiness. And indeed, there are many countries with significantly lower GDP and a life ladder score greater than in the United States.

A good fit for data that has this general shape is to use a logarithmic curve. This is because the logarithm is also ever-increasing, but the rate at which it increases slows towards 0. Using a logarithmic curve to model the decreasing marginal value of money isn't a new thing. Esteemed mathematician Daniel Bernoulli was the first to publish a paper with this kind of modeling, and he did it all the way back in 1738.

If we find the best-fit logarithmic curve for each year, you can see that the fit isn't half bad.

If you make the tangent visible, its slope is the entire point: the farther to the right you go, the smaller the slope. In other words, the higher a country's GDP, the less impactful more GDP will be on its life satisfaction.

What happens at the macro level happens at the micro level too. This marginal impact of money on happiness has been explored by behavioral economics, and the same shape was studied by Daniel Kahneman, who initially popularized the claim that happiness didn't significantly increase beyond an annual income of $75,000. While economists will argue about the particulars of the shape, there's broad alignment that happiness and income have a logarithmic relationship. In fact, one of Kahneman's last papers affirmed a logarithmic relationship between income and happiness rather than asserting a hard upper bound.

The Cost of Growth

So, to the extent that money buys happiness, it buys marginally less happiness the more money you have. But coming back to America, that's not what we see. Our social metrics aren't just growing more slowly; in many cases, they're decreasing.

We're also collectively destroying the planet on a quest for a mathematical impossibility: continual economic growth on a planet with finite resources. I've written before about how we can take a mathematical lens to the question of renewable resource adoption. Here, the same story is playing out. We are pursuing a goal of unsustainable growth, chasing some imagined positive gains that simply are not materializing. The windfalls that many countries saw from growth in the twentieth century are now in the rearview mirror. And whatever benefits the engines of growth still provide, half a century of flawed policy has trickled them up to the top 1%.

Is there any way out of the trap we've set for ourselves? How can we jump-start some of these stagnant measures of human flourishing, while not also destroying one another or the planet?

These questions are increasingly becoming the focus of academic study. And a paper from 2024, titled Post-growth: the science of wellbeing within planetary boundaries, does a great job of surveying current research attempts to tackle some of these thorny issues.

Growth, Green Growth, Negative Growth

One of the main focus areas of the review is a categorization of economic models into three buckets. The first is status quo: we acknowledge (or, depending on your political party, we don't) the downsides to our current social contract. But we convince ourselves that the upsides to growth outweigh the downsides, and therefore take no significant action to alter our course.

The second is a "green growth" model of the kind popularized by the Green New Deal. This approach acknowledges the ecological impact of our continued growth, and tries to correct for it by funneling our capitalistic desire for growth into transitioning that same economy into one based on renewable energy.

The third set of models is even more radical. It intentionally eschews growth. Instead of basing an economy around ensuring that GDP is forever increasing, these models optimize for the very things for which GDP has become an increasingly bad proxy. According to the authors, these include (but are not limited to) "sustainability, equity, and human wellbeing."

Economists have modeled different macroeconomic measurements over time for each of these buckets for a few different countries. The predictions for France are below for you to explore. Why France? Je ne sais pas, you'll have to take that up with the original authors.

One thing I noticed from these charts is how poorly a green growth strategy performs on several metrics. The change to GDP growth is negligible, but unemployment and the Gini coefficient (a measure of income inequality) actually perform worse than under the status quo. Across almost every metric, including CO2 reduction, the degrowth strategy performs significantly better. The one exception is government deficit as a percentage of GDP. This makes sense; if your goal is to intentionally shrink GDP, then calculating the deficit as a fraction of a shrinking pie can cause that fraction to grow even if the deficit itself is not growing at all.

It's no surprise, then, that the authors of this paper advocate for a degrowth strategy. They offer up more arguments than what I'm presenting here. And for an academic paper, it's surprisingly readable. If you take nothing away from this other than a marginally stronger desire to read an economics paper, I'll consider the time it took to write this well spent.

Up, Up, and to the Left!

While reducing carbon emissions and income inequality at the same time sounds like a great goal, there's one wrinkle: no country knows how to do it. Social progress has historically been pretty tightly coupled to ecological overreach.

At the end of the paper, the authors categorize multiple countries based on 2015 data along two axes: how many social thresholds has each country achieved, and how many biophysical boundaries has it crossed. The definitions for these thresholds are taken from a separate paper, titled A good life for all within planetary boundaries, and include metrics like:

• Do people in the country meet a minimum threshold for life expectancy and life satisfaction?
• How bad is the country's income inequality and unemployment?
• Are people receiving sufficient education, nutrition, sanitation, and social support?
• How much CO2 is the country emitting per capita per year?
• Could the earth sustainably support the lifestyle of individuals in the country if everyone lived the same way?

Ideally, countries will achieve all of the measures of social progress, while crossing as few of the ecological thresholds as possible. But unfortunately, based on the 2015 data, that's not what we see.

As you can see, based on the data, social progress is almost always tied to environmental degradation. The country closest to the upper left-hand corner is Costa Rica, which as of 2015 had crossed 6 out of 11 social thresholds but only 3 out of 6 environmental ones.

It's also worth pointing out that the countries with the largest circles are, without exception, on the right-hand side of the graph. In some sense this is baked into the metrics themselves; countries can't hoard resources without pushing themselves to the right, since the planet simply does not have enough resources for everyone to live the lifestyle we're accustomed to in America. But if all our extra GDP isn't helping us to live longer or happier, what's the point of having it?

Conclusion

You may have noticed that on our last chart, America is all the way to the right, and almost all the way at the top (though it wouldn't surprise me if we've regressed on some measures of social progress since 2015). But it's pretty clear, both from the data and anecdotally, that all of this wealth is not commensurate with a similar increase in life satisfaction.

Our multigenerational experiment in hoarding resources has demonstrated that not only is greed not good, but that it makes us less happy, less healthy, and contributes to ecological destruction and tremendous inequality. Turning towards a green economic revolution may help with some of these metrics, but is potentially worse for others. And fundamentally, the fact remains that continual growth flies in the face of mathematical reality.

Post-growth: the science of wellbeing within planetary boundaries, along with other papers like it, challenges us to imagine a new economic world, where human flourishing is not measured by or beholden to GDP. It's past time we recognize that growth isn't the solution; it's the thing for which we need a solution, because aside from those in the top 1%, it's no longer benefiting us.

Sources:

• World Bank Open Data
• World Happiness Report
• Understanding How Gallup Uses the Cantril Scale
• Exposition of a New Theory on the Measurement of Risk
• Income and emotional well-being: A conflict resolved
• Easterlin Paradox
• Post-growth: the science of wellbeing within planetary boundaries
• A good life for all within planetary boundaries