Economics of Happiness
How Jim Carrey helped me understand a crucial law of Economics and solve a human dilemma.
“I think everybody should get rich and famous and do everything they ever dreamed of so they can see that it’s not the answer”, said Jim, and a thunderous barrage of claps and hoots broke out at the graduation ceremony at Maharishi University, USA.
It wasn’t long before the internet was flooded with Jim’s quote, and motivational videos on YouTube embedded his advice. Instagram was throwing posts talking about what Jim said and how it is the ultimate truth.
Each time I was confronted with such a post, a thought ran through my head — I get it; becoming rich isn’t the answer. The answer to life that is. But at what point does a man feel rich? Maybe Jim feels rich at a 100,000$ and Jeff feels like he has a long way to go at 200,000$. What does it mean to get rich? Is it an unending spiral or is it simply running in circles. How do you explain ‘rich’? is it a state of mind?
Now I don’t know the scientific name of this approach, but I took my fundamental question — Is ‘Rich’ a state of mind?, and assumed it to be true. So, yes I say that ‘Rich’ is a state of mind; it is all in my head. I asked myself — How much money do you want to declare yourself rich? How many villas? cars? clothes? estate? There was no satisfactory answer. Each amount of money had more space for one more zero at the end. This approach wasn’t working.
Now, surely you must be thinking that money isn’t the answer; its happiness. Happiness is the real riches. Well, I know people who have lost their loved ones to diseases that are as easily treatable as Viral fever because of poverty. Happiness, therefore, is most often a byproduct of a thick wallet. If happiness is clearing a tough exam; money is the hard work you put in preparation.
I really wasn’t eating myself thinking of this, but it seemed like a question I would not find an answer to. And seemed like the second thing I would never understand ; the first being pineapple on Pizza.
As circumstantial as it may seem, I found the answer in my economics class. The professor walked in and asked ,“Who here likes cupcakes?”. Anticipating cupcakes, a few students raised their hands. Pointing to a girl sitting in the first row, the professor asked “What would happen if I gave you a cupcake now?”
“I would like it” replied the student joyously
“And then I give you another tomorrow”
“I would still like it”
“How about I keep giving you the same cupcake everyday for a year?”
“I would like it still, but not as much. I would like to have a different flavor at least” she said
“Yes!” the professor addressed the class enthusiastically “In other words the cupcake’s value has reduced because I kept supplying more of it everyday. That is called the Law of Diminishing Marginal Utility.”
The professor apparently had a very basic explanation to my question of ‘money and happiness’. It was simple — The more you get of something; the less you value it. It was a well known concept actually, but seldom applied on happiness.
So, maybe Jim got a lot of cupcakes (money) in his life, and therefore lost value (Happiness) for the cupcake altogether. Now his idea that cupcakes is not the answer makes sense, economically.
So that led me to think that maybe the amount of cupcakes we need is different. I might need fewer cupcakes to conclude that they are worthless, while you might need a whole lot more to conclude the same. But eventually these cupcakes will become worthless. And then we may move on from cupcakes to pursue something higher, like Life. And maybe then we can see why Bob Marley say, ‘My riches is life forever’.
