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The Relationship Between Money and Happiness

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Charting the Relationship Between Money and Happiness

Charting the Relationship Between Money and Happiness

Today’s chart is best viewed full-screen. Explore the high resolution version by clicking here.

Can money buy you happiness?

It’s a longstanding question that has many different answers, depending on who you ask.

Today’s chart approaches this fundamental question from a data-driven perspective, and it provides one potential solution: money does buy some happiness, but only to a limited extent.

Money and Happiness

First, a thinking exercise.

Let’s say you have two hypothetical people: one of them is named Beff Jezos and he’s a billionaire, and the other is named Jill Smith and she has a more average net worth. Who do you think would be happiest if their wealth was instantly doubled?

Beff might be happy that he’s got more in the bank, but materially his life is unlikely to change much – after all, he’s a billionaire. On the flipside, Jill also has more in the bank and is likely able to use those additional resources to provide better opportunities for her family, get out of debt, or improve her work-life balance.

These resources translate to real changes for Jill, potentially increasing her level of satisfaction with life.

Just like these hypotheticals, the data tells a similar story when we look at countries.

The Data-Driven Approach

Today’s chart looks at the relationship between GDP per capita (PPP) and the self-reported levels of happiness of each country. Sources for data are the World Bank and the World Happiness Report 2017.

According to the numbers, the relationship between money and happiness is strong early on for countries. Then later, when material elements of Maslow’s hierarchy are met, the relationship gets harder to predict.

In general, this means that as a country’s wealth increases from $10k to $20k per person, it will likely slide up the happiness scale as well. For a double from $30k to $60k, the relationship still holds – but it tends to have far more variance. This variance is where things get interesting.

Outlier Regions

Some of the most obvious outliers can be found in Latin America and the Middle East:

Latin America vs. Middle East

In Latin America, people self-report that they are more satisfied than the trend between money and happiness would predict.

Costa Rica stands out in particular here, with a GDP per capita of $15,400 and a 7.14 rating on the Cantril Ladder (which is a measure of happiness). Whether it’s the country’s rugged coastlines or the local culture that does the trick, Costa Rica has higher happiness ratings than the U.S., Belgium, or Germany – all countries with far higher levels of wealth.

In the Middle East, the situation is mostly reversed. Countries like Saudi Arabia, Qatar, Iran, Iraq, Yemen, Turkey, and the U.A.E. are all on the other side of the trend line.

Outlier Countries

Within regions, there is even plenty of variance.

We just mentioned the Middle East as a place where the wealth-happiness continuum doesn’t seem to hold up as well as it does in other places in the world.

Interestingly, in Qatar, which is actually the wealthiest country in the world on a per capita basis ($127k), things are even more out of whack. Qatar only scores a 6.37 on the Cantril Ladder, making it a big exception even within the context of the already-outlying Middle East.

Nearby Saudi Arabia, U.A.E., and Oman are all poorer than Qatar per capita, yet they are happier places. Oman rates a 6.85 on the satisfaction scale, with less than one-third the wealth per capita of Qatar.

There are other outlier jurisdictions on the list as well: Thailand, Uzbekistan, and Pakistan are all significantly happier than the trend line (or their regional location) would project. Meanwhile, places like Hong Kong, Ireland, Singapore, and Luxembourg are less happy than wealth would predict.

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Money

Ranked: The World’s Black Billionaires in 2021

Black billionaires make up fewer than 1% of all billionaires worldwide. Who are they, and how have they built their wealth?

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Black billionaires

The World’s Black Billionaires in 2021

Black billionaires make up fewer than 1% of all billionaires worldwide. Who are the select few who made it into the ranks of the world’s richest people?

In this graphic, we used the Forbes real-time billionaire list to highlight the most financially successful Black people, and the source(s) of their wealth.

Black Billionaires, Ranked

The data is as of February 24, 2021, and includes bi/multi racial individuals with Black ancestry. Altogether, there are 15 Black billionaires with a combined wealth of $48.9 billion.

Here is the how the full list breaks down:

RankNameNet WorthCitizenshipSource
1Aliko Dangote$11.5BNigeriaCement, sugar
2Mike Adenuga$6.1BNigeriaTelecom, oil
3Robert F. Smith$5.2BUnited StatesPrivate equity
4Abdulsamad Rabiu$4.8BNigeriaCement, sugar
5David Steward$3.7BUnited StatesIT provider
6Patrice Motsepe$3.1BSouth AfricaMining
7Alexander Karp$3.0BUnited StatesSoftware firm
8Oprah Winfrey$2.6BUnited StatesTV shows
9Michael Jordan$1.6BUnited StatesCharlotte Hornets, endorsements
10Michael Lee-Chin$1.5BCanadaMutual funds
11Strive Masiyiwa$1.4BZimbabweTelecom
12Kanye West$1.3BUnited StatesMusic, sneakers
13Mohammed Ibrahim$1.1BUnited KingdomCommunications
14Shawn Carter (Jay-Z)$1.0BUnited StatesMusic, multiple
15Tyler Perry$1.0BUnited StatesMovies, television

Aliko Dangote is the richest Black billionaire, and has held the title since 2013. He owns 85% of publicly-traded Dangote Cement, Africa’s largest cement producer. The company’s stock price went up more than 30% over the last year. In addition, Dangote also has investments in salt and sugar manufacturing companies.

The fifth richest Black person, David Steward, owns the technology solutions provider World Wide Technology. Steward had decided he wanted to be part of the technological revolution and founded the company in 1990, before the first internet browser had even been created. The company has since grown to be the largest Black-owned business in America with over $13.4 billion in annual revenue and more than 7,000 employees.

Best known for his music career, Shawn Carter, more commonly known as Jay-Z, is number 14 on the list. However, the rapper’s wealth goes far beyond his music. Jay-Z has built a diversified business empire, including investments in a fine art collection, an entertainment company, a clothing line, and alcohol brands. He recently sold half of his champagne brand to LVMH, the parent company of Dom Pérignon.

Unequal Representation

Unfortunately, little progress has been made with regards to the proportion of Black billionaires. Since 2011, Black billionaires have made up fewer than 1% of all billionaires worldwide.

Black billionaires

In absolute numbers, the total number of billionaires rose by over 1,100 while the number of Black billionaires rose by just nine people.

The number of Black billionaires also falls very short of being representative of the general population. For example, only 8 or 1.2% of America’s 665 billionaires are Black. By contrast, Black people make up 12.2% of the U.S. population.

Breaking Through Barriers

There is still a large racial wealth gap between Black people and White people—even at the highest levels of financial achievement. However, despite these racial and systemic barriers, 14 of the 15 Black billionaires are self-made, meaning they built their wealth from the ground up. Who will be next to join the ranks?

“Innovation doesn’t happen without a person of color or a diversity of thought being at the table in order to challenge the status quo.”
—David Steward

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Economy

How Global Health and Wealth Has Changed Over Two Centuries

This unique animated visualization uses health and wealth measurements to chart the evolution of countries over time.

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two centuries of health and wealth

How Global Health and Wealth Has Changed Over 221 Years

At the dawn of the 19th century, global life expectancy was only 28.5 years.

Outbreaks, war, and famine would still kill millions of people at regular intervals. These issues are still stubbornly present in 21st century society, but broadly speaking, the situation around the world has vastly improved. Today, most of humanity lives in countries where the life expectancy is above the typical retirement age of 65.

At the same time, while inequality remains a hot button topic within countries, income disparity between countries is slowing beginning to narrow.

This animated visualization, created by James Eagle, tracks the evolution of health and wealth factors in countries around the world. For further exploration, Gapminder also has a fantastic interactive chart that showcases the same dataset.

The Journey to the Upper-Right Quadrant

In general terms, history has seen health practices improve and countries become increasingly wealthy–trends that are reflected in this visualization. In fact, most countries drift towards the upper-right quadrant over the 221 years covered in the dataset.

However, that path to the top-right, which indicates high levels of both life expectancy and GDP per capita, is rarely a linear journey. Here are some of the noteworthy events and milestones to watch out for while viewing the animation.

1880s: Breaking the 50-Year Barrier
In the late 19th century, Nordic countries such as Sweden and Norway already found themselves past the 50-year life expectancy mark. This was a significant milestone considering the global life expectancy was a full 20 years shorter at the time. It wasn’t until the year 1960 that the global life expectancy would catch up.

1918: The Spanish Flu and WWI
At times, a confluence of factors can impact health and wealth in countries and regions. In this case, World War I coincided with one of the deadliest pandemics in history, leading to global implications. In the animation, this is abundantly clear as the entire cluster of circles takes a nose dive for a short period of time.

1933, 1960: Communist Famines
At various points in history, human decisions can have catastrophic consequences. This was the case in the Soviet Union (1933) and the People’s Republic of China (1960), where life expectancy plummeted during famines that killed millions of people. These extreme events are easy to spot in the animation due to the large populations of the countries in question.

1960s: Oil Economies Kick into High Gear
During this time, Iran, Iraq, and Saudi Arabia all experience massive booms in wealth, and in the following decade, smaller countries such as the United Arab Emirates and Kuwait rocket to the right edge of the visualization.

In following decades, both Iran and Iraq can be seen experiencing wild fluctuations in both health and wealth as regime changes and conflict begin to destabilize the region.

1990s: AIDS in Africa
In the animation, a number of countries plummet in unison at the end of the 20th century. These are sub-Saharan African countries that were hit hard by the AIDS pandemic. At its peak in the early ’00s, the disease accounted for more than half of deaths in some countries.

1995: Breaking the 65-Year Barrier
Global life expectancy reaches retirement age. At this point in time, there is a clear divide in both health and wealth between African and South Asian countries and the rest of the world. Thankfully, that gap is would continue to narrow in coming years.

1990-2000s: China’s Economic Rise
With a population well over a billion people, it’s impossible to ignore China in any global overview. Starting from the early ’90s, China begins its march from the left to right side of the chart, highlighting the unprecedented economic growth it experienced during that time.

What the Future Holds

If current trends continue, global life expectancy is expected to surpass the 80-year mark by 2100. And, sub-Saharan Africa, which has the lowest life expectancy today, is expected to mostly close the gap, reaching 75 years of age.

Wealth is also expected to increase nearly across the board, with the biggest gains coming from places like Vietnam, Nigeria, and the Philippines. Some experts are projecting the world economy as a whole to double in size by 2050.

There are always bumps along the way, but it appears that the journey to the upper-right quadrant is still very much underway.

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