Yes, money can make you happy

The deeper problem involves the sheer breadth of the categories that constitute the authors’ principles. Dunn and Norton argue that it is often best to spend money on experiences. But surely everything depends on the experience and the alternative. What concrete experience is being compared with what concrete commodity? Some vacations are awful; so are some concerts. By contrast, some commodities can have real effects on happiness. As possibilities, consider a cherished work of art, a new camera, a terrific (and light) laptop, even a rotary shaver (I speak from experience). Dunn and Norton must mean that an excellent experience is likely to have better hedonic effects than a comparably priced and apparently excellent commodity. But it is not clear that their evidence supports that conclusion, or even what it means.

The point is quite general. To decide whether people should decide to buy time, we need to know how much time costs, and how much time would be saved, and what, concretely, the time would be spent on, and what else might be done with the money. Often it makes sense to pay now and to consume later, but a delayed payment might make a lot of sense, especially if we can use the money for other things (such as education or food), and if immediate consumption is necessary or highly desirable (maybe your child needs a doctor right now). Sure, spending money on others can boost happiness, but if happiness is what matters, maybe a wonderful trip, or a new apartment right near work, would provide an even bigger boost. Dunn and Norton do not explore conflicts among their five principles, which arise every day.

Dunn and Norton have outlined a series of valuable and instructive findings, demonstrating that people tend to overlook the effects of attention and adaptation, and that they would do better if they were to make expenditure decisions with those effects in mind. But abstract principles in favor of experiences, treats, time, deferred consumption, and gifts provide imperfect guidance when people are deciding among concrete goods, including those that are fun, important, or necessary but do not fall within those categories at all.