To What Extent Does Economic Growth Lead to Greater Happiness? A Cross-Country Analysis (2022-2024)

This paper explores the impact of short-term economic growth on subjective well-being in countries worldwide. Based on a global cross-country dataset of 126 countries for the years 2022 to 2024, the research investigates the link between percentage changes in real GDP per capita (PPP) and percentage changes in national happiness scores. The study, relying on graphical representations, Pearson correlation coefficients, and income group division, concludes that there is no significant global correlation between economic growth and the changes in happiness (r = 0.049). Low-income countries exhibit a weak positive association, whereas high-income countries display a weak negative correlation, and middle-income countries show no systematic relationship. These results are consistent with the concept of diminishing marginal utility of income and hedonic adaptation, indicating that after satisfying basic material needs, additional income growth makes a minimal contribution to well-being. The findings point to the fact that policymakers aiming to increase national happiness should, instead of concentrating on GDP growth, enhance the quality of institutions, extend social protection, focus on mental health, and work on reducing inequality. The main drawbacks are the short period considered and the lack of inflation-adjusted household income data.