Money Can Buy Happiness, Says A Study By Nobel-Prize Winning Economist

Can money buy happiness? It's a question that economists and social scientists have been trying to answer for decades. But now, a new study has provided a fresh answer - happiness tends to rise with increase in income and earnings, as per a report in The Washington Post. It is based on research conducted by Daniel Kahneman, a Nobel-Prize winning economist, and Matthew Killingsworth, from Princeton University and the University of Pennsylvania, who did number crunching to arrive at this conclusion, the outlet further said. It contradicts a 2010 research that said money could only boost happiness up to a point - about $75,000 in annual earnings.

Mr Kahneman was one of the two authors of the earlier study, which became so popular that a credit card company founder raised the minimum salaries of his employees to $70,000, cutting his own salary to do so.

The new study has been published this month in the Proceedings of the National Academy of Sciences, as per the Post report.

The two researchers surveyed 33,391 people in the US aged between 18 and 65. These people had a household income of at least $10,000 a year.

According to the outlet, the researchers recorded the responses about their feelings at random intervals through a smartphone app. The responses ranged from "very bad" to "very good".

CBS News said the study reached two big conclusions: Happiness does improve with higher earnings, up to $500,000 a year, and there is group of people for whom higher incomes don't make much of a difference. This "unhappy group" comprised about 15 per cent of people, the outlet further said citing the study.

However, Mr Killingsowrth cautioned in a statement that money isn't everything - "just one of the many determinants of happiness." He added: "Money is not the secret to happiness, but it can probably help a bit."