Name
Professor
Couse
Date
Economic Growth and Happiness
The point of economics is finding ways of improving the living standards. Gross domestic product
(GDP) is used to estimate the economic growth of a country. GDP measures the output of the
economy that is valued at the economic prices. The more the society produces and earns, the well-
being of their material increases in a similar manner.
In explaining how people’s happiness in high-income economies decline over time even when
their countries grow richer, the law of diminishing value is relevant. The high-income economies
have enjoyed all the resources in comparison to the people in low-income economies. Low-income
economies mark a certain growth thus the people in it still seem happier. Results of a research by
the Gallup Organization revealed that most people in high-income areas like Japan, United States,
and Europe are happy while most people in low-income areas specifically Africa are not. Angus
Deaton of Princeton said this after evaluating the Gallup World poll: “The very strong international
relationship between per capita GDP and life satisfaction suggest that, on average, people have a
good idea of how income, or the lack of it, affects their lives.” Over time, the countries do not
seem happier through the new generations are becoming richer. This is revealed in the United
States where the proportion of the happy people did not change over 60 years of economic growth
