One example is the study "Spending Money on Others Promotes Happiness". It looks at how personal spending (paying bills or buying things for ourselves) and prosocial spending (donations or gifts for others) affect us differently. The findings:
- People with higher prosocial spending report being happier than those with low prosocial spending. The amount of personal spending, on the other hand, has no effect on happiness. Of course, this could just mean happy people are more generous, or they're happy and generous because they're rich. But the second half of the study addresses that.
- Researchers asked people to rate their happiness in the morning, then gave them either $5 or $20 and told them to spend it by 5 pm. Half the participants were told to spend the money on themselves and the other half were told to use the money for a donation or gift. When the researchers called participants that evening, the people assigned to prosocial spending reported greater happiness.1
- Participants predicted that personal spending would be more enjoyable than prosocial spending, and that $20 would make them them happier than $5. They were wrong on both counts - they were happier after prosocial spending, and the amount didn't matter for either kind of spending.
- Our intuitions about what will make us happy are sometimes wrong.
- If a transaction (spending or giving) makes us happy, but a larger amount doesn't make us happier, we should go for smaller transactions. In my experience, this is true - I like buying things, but buying a pastry or a few flowers makes me as happy as a larger purchase. And I enjoy two small helpings of dinner more than a single large one.
- Giving $5 is not the same as giving $5,000. And it may be more fun to give researchers' money than your own. Does the pleasurable effect still apply? Maybe. I know I get pleasure out of giving large amounts, but probably not as much as spending them.
- It's most efficient to give large amounts every year or so, so that the charities don't have to process a lot of small donations. But it's probably more enjoyable to donate small amounts often.