How much is more time with your friends worth?
Being able to spend more time with friends provides an increase in happiness worth up to an additional $133,000 a year. Meanwhile, actual pay raises have very little affect on happiness (Hat Tip: Penelope Trunk):
There is substantial evidence in the psychology and sociology literature that social relationships promote happiness for the individual. Yet the size of their impacts remains largely unknown. This paper explores the use of shadow pricing method to estimate the monetary values of the satisfaction with life gained by an increase in the frequency of interaction with friends, relatives, and neighbours. Using the British Household Panel Survey, I find that an increase in the level of social involvements is worth up to an extra £85,000 a year in terms of life satisfaction. Actual changes in income, on the other hand, buy very little happiness.
Source: “Putting a price tag on friends, relatives, and neighbours: Using surveys of life satisfaction to value social relationships” from Journal of Socio-Economics
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