Vaniver comments on The Fallacy of Dressing Like a Winner - Less Wrong
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Quick correction: that's satisfaction. One of the odd things about mood research is that satisfaction and happiness are distinct things measured distinctly- essentially, happiness is near mode and satisfaction is far mode. When you ask questions like "how many times did you smile in the last week?" which measures near mode happiness, you generally get no correlation between happiness and income in one country*, and a negative correlation between countries (i.e. Nigerians are happier than Americans). When you ask people how satisfied they are with their lives (sorry, but I don't remember an example off hand), then you get a pretty strong relationship between log(income) and satisfaction, both within countries and between countries.
* Research in America shows happiness increases up until a pretty low income, then a flatline.