John Hoffmire: Society today should remember lessons from Midas
One of the most recognizable myths from ancient Greece is the tale of King Midas. For those unfamiliar with the story, King Midas received a wish from the god Dionysus that he used to have everything he touched turn into gold. At first delighted, Midas quickly realized the folly of his decision after he was unable to eat and, according to a version by Nathaniel Hawthorne, accidentally turned his daughter into gold. This story teaches a valuable lesson about moderation in consumption and desires.
However, despite the story’s endurance in popular culture, the underlying lesson eludes many of us today. While we know not to waste a wish on the fabled “golden touch,” do we understand that greater wealth is not synonymous with greater happiness? Recent trends of lower savings rates, defaulting on loans and spending beyond our means suggest otherwise.
In fact, these trends seem to support another hypothesis: despite knowing that one cannot buy happiness, we find ourselves caught on what social science has labeled the hedonic treadmill.
The term was first used by Philip Brickman and Donald Campbell in a 1971 article as a logical outgrowth of adaptation theory, which states that people will on average maintain the same level of happiness by adapting to their current environment.
Thus, regardless of the size of changes, positive or negative, people will return to their equilibrium level of satisfaction, be it positive or negative. Or, in terms of the analogy, no matter how fast or slow the treadmill runs, the person running remains in exactly the same place. While recent studies have disproved this theory when it is not applied to pleasure, economists have time and again proved its accuracy when analyzing consumption.
Too many times in life we fall into the trap of believing, “If I could just get this one present I would be content.” Or, “After I make this purchase, I will be much happier.” But, after the initial thrill has worn off and our increase becomes a part of our daily lives, are we really any better than before? Or do we quickly adapt to our new reality, falling back to our former level of unhappiness or happiness?
Therein lies the trap of the hedonic treadmill: we spend and spend searching for that elusive happiness increase, when in return all we end up doing is losing money and getting almost no improvement.
Think about your consumption on a day-to-day basis, outside basic needs like food, fuel and shelter. When you purchase a new item, is it filling a real need or some perceived need due to your social environment?
Said another way, do most of us spend money for things we truly will benefit from, or do we spend to keep up with the proverbial Joneses? Our current connected lifestyles, made possible by social media and the Internet, exacerbate this tendency. Whether we share our life’s details online, we are constantly exposed to others’ accomplishments and decisions, potentially making our life seem boring or somehow lacking, causing us to try to compete with a digital reality.
Thankfully, social science has discovered that the hedonic treadmill works in reverse as well: decreases in consumption do not negatively impact our happiness. But, rather than just focusing on maintaining the status quo, related research by Daniel Mochon, Michael Norton and Dan Ariely has shown that regular experiential activities, such as exercise and religious worship, actually boost our base level of happiness.
My hope is that we can step off the hedonic treadmill, focusing instead on efforts that provide lasting happiness, especially those that build healthy relationships and improve personal well-being.
John Hoffmire is director of the Impact Bond Fund at Saïd Business School at Oxford University and directs the School of Business and Poverty at the Wisconsin School of Business at UW-Madison. He runs Progress Through Business, a nonprofit group promoting economic development. Ben Young, Hoffmire’s colleague at Progress Through Business, did the research for this article.