New research from the UK suggests that making more money may not make you happier, especially if you are neurotic.
In a working paper, economist Dr. Eugenio Proto, from University of Warwick, looked at how personality traits can affect the way we feel about our income in terms of levels of life satisfaction.
Proto discovered that neurotic people can view a pay rise or an increase in income as a failure if it is not as much as they expected.
Neurosis is characterized by excessive anxiety and emotional upset. Neuroticism is an enduring tendency to experience negative emotional states, such as anxiety, anger, guilt and depression.
Proto, who co-authored the paper with Aldo Rustichini, Ph.D., from the University of Minnesota, said people who are on a high salary and have high levels of neuroticism are more likely to see a pay rise as a failure.
He said: “Someone who has high levels of neuroticism will see an income increase as a measure of success. When they are on a lower income, a pay increase does satisfy them because they see that as an achievement.
“However, if they are already on a higher income they may not think the pay increase is as much as they were expecting. So they see this as a partial failure and it lowers their life satisfaction.”
In the paper, Dr Proto used data from the British Household Panel Survey and the German Socioeconomic Panel.
“These results suggest that we see money more as a device to measure our successes or failures rather than as a means to achieve more comfort.”
Source: University of Warwick