Giving more won't make you happier

By Milan_Griffes @ 2018-12-10T18:15 (+47)

See also: Time-series data for income & happiness?

At first approximation, there are two motivations for donating money – egoistic & altruistic.

The egoistic motivation relates to the personal benefit you accrue from giving your money away. The altruistic motivation relates to the benefits that other people receive from your donations. (This roughly maps to the fuzzies vs. utilons (a) distinction.)

The egoistic motivation for donating is scope insensitive

The egoistic motivation for donating is highly scope insensitive – giving away $500 feels roughly as good as giving away $50,000. I haven’t found any academic evidence on this, but it’s been robustly true in my experience.

This scope insensitivity seems pretty baked in – knowing about it doesn’t make it go away. I can remind myself that I’m having 100x the impact when I donate $50,000 than when I donate $500, but I find that when I reflect casually about my donations, I feel about as satisfied at my small donations as I do about my large ones, even after repeatedly reminding myself about the 100x differential.

We’re probably also scope insensitive qualitatively – giving $5,000 to a low-impact charity feels about as good as giving $5,000 to an effective charity (especially if you don’t reflect very much about the impact of the donation, and especially especially if the low-impact charity tells you a compelling story about the particular people your donation is helping).

Effective giving increases happiness, but so does low-impact giving

EA sometimes advocates that giving will increase your happiness. Here’s an 80,000 Hours article (a) to that effect. Here’s a piece by Giving What We Can (a).

I think sometimes implicit here is the claim that giving effectively will increase your happiness (I think this because almost all other discussion of giving in EA spaces is about effective giving, and why effective giving is something to get excited about).

It seems pretty clear that donating some money to charity will increase your happiness. It’s less clear that donating to an effective charity will make you happier than donating to a low-impact charity.

Given the scope insensitivity of the egoistic motivation, it’s also unclear that giving away a lot of money will make you happier than giving away a small amount of money.

It seems especially unclear that the donation-to-happiness link scales anywhere linearly. Perhaps donating $1,000 makes you happier than donating $100, but does it make you 10x as happy? Does donating $2,000 make you 2x as donating $1,000? My intuition is that it doesn’t.

Income increases happiness, up to a point

Okay, so that’s a bunch of discussion from intuition & lived experience. Now let’s look at paper.

Jebb et al. 2018 analyzed Gallup Worldwide Poll survey data on income & happiness. This dataset had responses from about 1.7 million people in 164 countries, so we don’t have to worry about small sample size.

Jebb et al. were curious about the income satiation effect – is there a point at which additional income no longer contributes to subjective well-being? And if there is, where is it?

Jebb et al. found that there is indeed an income satiation effect (see Table 1). Globally, happiness stopped increasing alongside income after $95,000 USD / year. For Western European respondents, happiness stopped increasing alongside income after $100,000 USD / year. For North American respondents, the satiation point was $105,000 USD / year.

An aside on terminology

"Subjective well-being" is the term social scientists use to think about happiness. Researchers usually break subjective well-being down into two components – life evaluation & emotional well-being. Here are heavyweights Daniel Kahneman & Angus Deaton on how those two things are different (a):

Emotional well-being (sometimes called hedonic well-being or experienced happiness) refers to the emotional quality of an individual's everyday experience – the frequency and intensity of experiences of joy, fascination, anxiety, sadness, anger, and affection that make one's life pleasant or unpleasant. Life evaluation refers to a person's thoughts about his or her life. Surveys of subjective well-being have traditionally emphasized life evaluation. The most commonly asked question in these surveys is the life satisfaction question: “How satisfied are you with your life as a whole these days?” ... Emotional well-being is assessed by questions about the presence of various emotions in the experience of yesterday (e.g., enjoyment, happiness, anger, sadness, stress, worry).

Jebb et al. break down emotional well-being further into positive affect & negative affect, which roughly correspond to experiencing positive & negative emotive states.

Life evaluation seems like the more intuitive metric for our purposes here. (It’s also the more conservative choice due to its higher satiation points.) So when I talk about "happiness," I'm actually talking about "subjective well-being as assessed by life evaluation scores." My main points would still hold if we focused on emotional well-being instead.

Income increases happiness up to $115,000 / year

Returning to Table 1, we can pull out a couple of takeaways:

Essentially, all income earned up to $115,000 USD / year (for college-educated folks living in North America & Western Europe) contributes to one’s happiness.

Putting it all together

We can use the Jebb et al. paper to infer that donations which put your annual income below $115k will probably make you less happy. (And if you’re giving substantial amounts while earning a total income of less than $115k, those donations will probably contribute to a decrease in your happiness.)

Correspondingly, donating amounts such that your annual income remains above $115k probably won’t affect your happiness.

There’s a wrinkle here: it’s possible that much of the happiness benefit of earning a high income comes from the knowledge that you earn a high income, not what you use the money for materially. If this is the case, donating large amounts out of an income above $115k shouldn’t ding your happiness.

So perhaps only a weaker version of the claim holds: once you achieve an annual income above $115,000, you can give away large portions of it without incurring a happiness penalty (having already realized the happy-making benefit of your earnings). But even in this case, donating large amounts out of an income less than $115k still lowers your happiness (because you never benefit from the knowledge that you earn at least $115k).

It’s true that the act of donating will generate some personal happiness. But given the scope insensitivity at play here, you can realize a lot of this benefit by donating small amounts (and thus keeping a lot more of your money, which can then be deployed in other happy-making ways).

From a purely egoistic viewpoint, scope insensitivity lets us have our cake & eat it too – we can feel good about our donating behavior while keeping most of our money.

Conclusion: EA shouldn’t say that effective giving will make you happy

My provisional conclusion here is that EA shouldn't recommend effective giving on egoistic grounds.

There remains a strong altruistic case to be made for effective giving, but I think it’s worth acknowledging the real tradeoff between giving away large amounts of money and one’s personal happiness, at least for people earning less than $115,000 USD / year (on average, for college-educated people in Western Europe & North America). If you want to give large amounts while avoiding this tradeoff, you should achieve a stable annual income of at least $115k before making substantial donations.

Further, EA should actively discourage people from effective giving if they're mainly considering it as a way to become happier. Effective giving probably won't make you happier than low-impact giving, and donating large amounts won't make you happier than donating small amounts. Saying otherwise would be a false promise.

Thanks to Gregory Lewis, Howie Lempel, Helen Toner, Benjamin Pence, and an anonymous collaborator for feedback on drafts of this essay. Cross-posted to my blog.

null @ 2018-12-10T23:20 (+48)

My own view here is:

i) Like Greg I've only ever seen the claim that donating some can be better for one's own welfare, compared to a baseline of not giving at all - not that the EA approach to giving is actually the optimal for happiness (!).

Giving small amounts regularly to a variety of emotionally appealing causes is more likely to be optimal for one's selfish welfare, at least if you don't have an EA mindset which would render that dissatisfying. As you say, 'give 10% once a year to the most effective charity' is likely worse than that.

ii) Unfortunately I don't have time to look into whether your source on income satiation points is better than the older one I used in my article. Personally, I think a focus on a 'satiation point' at which income yields literally zero further welfare gain is the wrong way to think about this. I am skeptical that the curve ever entirely flattens out, let alone turns back around. Rather I'd expect logarithmic returns (or perhaps something a bit sharper), up into the tens or hundreds of millions of dollars of income. Given the difficulty of measuring satisfaction, especially in the upper tail of income, I would trust this more common sense model over empirical measurements claiming otherwise. Above ~$100,000, additional gains in welfare are probably just too small for our survey methods to pick up.

For this reason 80,000 Hours use more modest language like "any extra income won’t affect your happiness that much", rather than claiming the effect is nothing.

Nonetheless, at high levels of income, further raising one's income gradually becomes a minor issue, before it becomes an entirely unmeasurable one. At that point, many people will better accomplish their life goals by focussing on improving the world - thereby giving themselves more community, higher purpose, sense of accomplishment, and indeed actual accomplishment - rather than eking out what limited returns remain from higher earnings, and this seems important to point out to people.

iii) So, while I say from an egoist perspective 'give 10% once a year to the most effective charity' is probably dominated by a 'fuzzy-hacking' approach to charity, that's not completely obvious.

Giving larger amounts, and giving them to the best charities one can find, often becomes a core part of people's identity, probably raising their sense of purpose / satisfaction with their work at all times, rather than just via a warm glow immediately after they donate a small sum. I don't think any of the evidence we've looked at can address this issue, except the observational studies, which are hopelessly confounded by other things.

Furthermore, being part of effective altruism or Giving What We Can can provide participants with a community of people who they feel some connection to, which many people otherwise lack, and which seems to have a larger effect on happiness than money. Finally, giving to the best charities allows people to show off to themselves about their uncommon intelligence and sophistication as a giver, which can also contribute to a positive self-conception.

We know that involvement in a religious community is correlated with large gains in welfare, and involvement in any philosophical community like effective altruism seems likely to bring with it some - though not all - of the same benefits.

Of course there are downsides too. In the absence of any actual data, I would remain agnostic, and act as though this were more or less a wash for someone's happiness. I wouldn't want someone to start being altruistic expecting it to make their life better, but I'd also want to challenge them if they were convinced it would make their life worse.

From this perspective, articles saying that giving or other acts of altruism are not as detrimental to someone's welfare as one might naïvely anticipate, seem to me to be advancing a reasonable point of view, even if future research may yet show them to be mistaken.

null @ 2018-12-11T18:41 (+1)
I've only ever seen the claim that donating some can be better for one's own welfare, compared to a baseline of not giving at all - not that the EA approach to giving is actually the optimal for happiness (!).

Clarified my view somewhat in this comment. See also this comment.

null @ 2018-12-11T18:39 (+1)

Thanks for this; I accord with almost all of what you're saying.

Re: the community benefits of EA, these mostly seem to accrue via active participation in EA spaces (the Forum, facebook groups, working with EA orgs, attending meetups & conferences), rather than by making large donations.

Making donations seems important for feeling a sense of membership in the community, but I think this benefit can be realized by making nominal donations only. (The 50th percentile respondent to the 2018 EA survey gave 2.9% of their income; I speculate that folks who were motivated enough to fill out the survey probably feel like part of the EA community.)

null @ 2018-12-10T22:10 (+30)

"EA sometimes advocates that giving effectively will increase your happiness. Here’s an 80,000 Hours article (a) to that effect. ... This line of argument confuses the effect of donating at all with the effect of donating effectively."

This article you link to (by me) does not mention giving large amounts, or the effectiveness of charities, or advocate for giving to charity, so it's hard to see how it could be confusing that issue. I would appreciate if you could edit the article to clarify that.

It also doesn't claim that giving necessarily makes you happier than spending the money on yourself, only that in a given case it is possible - which it certainly is - and that giving likely provides more satisfaction than not having the money in the first place:

"Giving some money to charity is unlikely to make you less happy, and may well make you happier. ... donating money could easily make you happier than spending it on yourself... there’s good reason to think that giving away money will lower your subjective well-being significantly less than not having it in the first place."

In fact, the article only tangentially discusses donations at all. Nonetheless, I have added some further text to clarify my view.

null @ 2018-12-11T18:27 (+5)

Thanks, I edited that part of the piece to get more accurate about 80k's view & the thing I'm pointing to.

More on what I'm pointing to in this comment.

null @ 2018-12-11T19:06 (+5)

Thanks, much appreciated Milan! :)

null @ 2018-12-10T21:16 (+10)

Upvoted for bringing in a lot of cool research! Didn't strong-upvote because I felt the conclusion was a little too strong ("actively discourage", especially), and I wish you'd linked to some examples of EA promoting egoistic giving.

----

1. I sense a really fantastic opportunity here to trick Buzzfeed into donating a lot of money: "$10 charitable donation vs. $1000 charitable donation".

2. Is there a particular case of EA communication that you think actively goes against the science you cite? I vaguely remember seeing writing in a few places along the lines of "giving can make you happier" or "giving effectively can make you more confident" (and by implication, happier), but not "giving more can make you happier".

3. It would be good to see one of these studies specifically take on EA-style giving, where people often have an unusually strong sense of what their money is buying and can feel unusually confident that it will actually help. Most charities don't have anything nearly as immersive as GiveDirectly Live, a website which (to me) makes every additional dollar I give pretty darn salient.

4. "Actively discouraging" people who want to use effective giving to become happier seems far too strong. For one, the studies you cite generally look at large numbers of people; even if giving doesn't make the average person happier, it still seems like it could make any given individual happier.

If we want to give maximally accurate information, we could say "there are a lot of different things that might work, giving is one, saving your money might be better", but our ability to advise individuals seems really context-dependent. I've known people who I thought would actually be a lot happier upon donating more; I've known other people for whom "get financially secure so you can have FYM ASAP" was better egocentric advice.

5. Finally, if someone comes up to us and says "I just want to make myself happy, should I give more?"...

...maybe we should, instead of saying "no", say "why not consider trying to want other people to be happy, too?"

Becoming more altruistic in spirit/personality seems to be pretty helpful for a lot of people. I don't know how much the science backs that up, so I wouldn't recommend it as an official response, but "caring about other people makes you happy" does seem like one of the strongest cross-cultural "common sense" lessons in all of human experience.

null @ 2018-12-10T22:04 (+2)

Re: this part of 4 in particular – "there are a lot of different things that might work, giving is one, saving your money might be better"

I think Jebb et al. 2018 gives evidence that saving your money would be better than making greater-than-nominal donations, at least until you achieve financial independence.

null @ 2018-12-10T21:58 (+1)

Re: 4 & 5 – it's kind of an edge case, because I think everyone is motivated by both egoistic & altruistic drives to some degree.

I don't know of any evidence that donating effectively makes someone happier than just donating.

Similarly, I don't know of any evidence that the donations<>happiness link scales linearly with donation size. (My guess is that the link is heavily sublinear.)

null @ 2018-12-11T00:52 (+6)

I agree that the link is probably heavily sublinear. But I wonder if it becomes less sublinear if one is more conscious of impact-per-dollar.

I've had this experience myself, sort of, in that I began to enjoy giving more after I found EA and my previous "well, I hope this works" feeling resolved into "yes, I found the best deal on helping!". And since I know that I've found a good deal with high-EV returns, giving more does feel better, just as it would if I were depositing more money into a high-yield investment. Meanwhile, because I have enough money to be materially comfortable, the idea of "$1000 in savings lets me skip working for another two weeks in 40 years, assuming I even want to stop working" doesn't hold much appeal, compared to "spending $1000 on one of the world's best products".

null @ 2018-12-11T18:44 (+1)

I think there are many other use-cases for savings than just retiring earlier (e.g. Jeff & Julia's mercury catastrophe, which cost $50,000 to clean up).

null @ 2018-12-11T20:11 (+2)

This is certainly true! Money can buy almost anything, including security against future disasters. I'm only making a personal claim about myself and my own use of money. I personally often feel like giving is the form of spending that will make me "happiest", because it feels like a direct path to me getting a sense of personal satisfaction in a way that saving often doesn't.

null @ 2018-12-11T00:58 (+2)

People are more likely to give when certain markers of "effectiveness" are satisfied (e.g. you tell them exactly how the money will be spent, you tell them the charity is relatively low-overhead, you tell them how much progress you've made toward solving a problem).

"More likely to give" =/= "more happy after giving", but it does seem to represent something like "anticipates being happier after giving" (that's a reasonable interpretation for why people do almost anything with money).

These claims come from what I remember about writing a thesis on giving behavior. The relevant material starts on p. 59, items (1), (4), and (6), though I'm synthesizing a broader base of evidence here (plus a bit of intuition from my experiences talking about EA with people outside the community).

null @ 2018-12-10T21:54 (+1)

Re: 2 – I included a couple examples:

EA sometimes advocates that giving effectively will increase your happiness. Here’s an 80,000 Hours article (a) to that effect. Here’s a piece by Giving What We Can (a).
null @ 2018-12-10T23:13 (+27)

Neither of your examples backs up your point.

The 80000 hours article you cite notes in its summary only that:

Giving some money to charity is unlikely to make you less happy, and may well make you happier. (My emphasis)

The GWWC piece reads thus:

Giving 10% of your income to effective charities can make an incredible difference to some of the most deprived people in the world. But what effect will giving have on you? You may be concerned that it will damage your quality of life and make you less happy. This is a perfectly reasonable concern, and there is no shame in wanting to live a full and happy life.

The good news is that giving can often make you happier.... (My emphasis)

As I noted in prior discussion, not only do these sources not claim 'giving effectively will increase your happiness', I'm not aware of this being claimed by any major EA source. Thus the objection "This line of argument confuses the effect of donating at all with the effect of donating effectively" targets a straw man.

null @ 2018-12-10T23:52 (+6)

While that piece on income and happiness seems solid, Milan might not like the vibe of this section in our article No matter your job, here’s 3 evidence-based ways anyone can have a real impact. I've just tinkered with the wording to make it harder for anyone to misunderstand what we're claiming:

"How much sacrifice will this involve?

Regardless of which career you choose, you can donate 10% of your income.

Normally when we think of doing good with our careers, we think of paths like becoming a teacher or charity worker, which often earn salaries as much as 50% lower than jobs in the private sector, and may not align with your skills or interests. In that sense, giving 10% is less of a sacrifice.

Moreover, as we saw in an earlier article, once you start earning more than about $40,000 a year as an individual, any extra income won’t affect your happiness that much, while acts that help others like giving to charity probably do make you happier.

To take just one example, one study found that in 122 of 136 countries, if respondents answered “yes” to the question “did you donate to charity last month?”, their life satisfaction was higher by an amount also associated with a doubling of income.5 In part, this is probably because happier people give more, but we expect some of the effect runs the other way too.

(Not persuaded? Read more on whether giving 10% is better or worse for your happiness than not donating at all.)"

null @ 2018-12-11T18:18 (+2)

Right, the only disagreement I have with that piece is this part: "... once you start earning more than about $40,000 a year as an individual, any extra income won’t affect your happiness that much"

From my current understanding, extra income will continue to affect happiness quite a bit up to at least $115,000 / year (on average for college-educated people in Western Europe and North America, in terms of subjective evaluation of one's life quality).

And achieving an income of $115,000 / year is much harder than achieving one of $40,000 / year.

null @ 2018-12-12T02:20 (+16)

I don't know if it's more or less reliable than past research suggesting a lower satiation point, but taking the paper Jebb et al. 2018 at face value, this is the effect of a 160% increase in income, from $40k to $105k:

In North America, life satisfaction goes from 7.63 to 8.0. Zero effect on positive affect (effects on positive affect/happiness are always lower and it's the measure I think is more reliable, which is why we chose the term happiness in that quote). Negative affect-free goes from 0.7 to 0.74.

Effects in Western Europe are a touch smaller.

Whether this counts as "extra income continuing to affect happiness quite a bit" or "extra income not affecting happiness that much" I guess is for readers to judge.

For myself, I would regard those gains to be sufficiently small that I would think it irrational for an egoist to focus much of their attention on earning more money at that point, rather than fostering strong relationships, a sense of purpose, or improving their self-talk.

Personally, I also expect even those correlations are overestimates of the actual effect of higher income on happiness, because we know the reverse is also happening: for various reasons happiness itself causes people's incomes to rise. On top of that, things like health also cause both happiness and higher incomes, increasing the correlation without increasing the causation. (Though as I describe in my income and happiness article, if you have a different causal diagram in mind, you could also try arguing that it's an underestimate.)

null @ 2018-12-16T17:18 (+5)
Whether this counts as "extra income continuing to affect happiness quite a bit" or "extra income not affecting happiness that much" I guess is for readers to judge.

I notice I have some difficulty thinking through the implications of a 0.5 bump in life satisfaction on a 0.0 to 10.0 scale, especially when the 0.5 increase is in aggregate across an entire lifetime.

On one view, 0.5 doesn't seem like that much. "7.5 instead of 8.0? That's a negligible effect. Once you're at 7.5 life-satisfaction-wise, time to focus on other things."

On another view, the 0.5 bump is quite a lot. If 10.0 on the scale is "most satisfying life possible", going from 7.5 to 8.0 could be a big frickin' deal. Also could be a big deal if the 0.5 bump cashes out to something like "one less terrible day per month, for the rest of your life".

This consideration is probably dominated by measurement problems though. When I subjectively assess my life satisfaction, I have trouble discerning the difference between a 7 and an 8 on a 0-10 scale (though I'm benchmarking on 10 being "best out of the ways my life has tended to go", not "most satisfying life possible").

I've started using a 0-5 scale because of this granularity consideration. It's much easier for me to tell apart the difference between 3 and 4 on a 0-5 scale than it is to tell apart 7 and 8 on a 0-10 scale.

This is all to say that a 0.5 bump on a 0.0-10.0 scale might not be subjectively detectable at all to most people. (Though a 0.5 in-aggregate effect could still cash out to large subjective gains for many people.)

null @ 2018-12-16T17:26 (+1)
For myself, I would regard those gains to be sufficiently small that I would think it irrational for an egoist to focus much of their attention on earning more money at that point, rather than fostering strong relationships, a sense of purpose, or improving their self-talk.

I agree with this.

The main takeaway I'm pushing here is something like:

"After a certain point, making more money has severe diminishing returns re: your happiness, as does donating lots of money.

So don't lean on making lots of money to make you happy, and don't lean on giving away lots of money to make you happy."

There's a temptation to use "donate a lot of money to effective causes" to scratch the "sense of purpose" itch, which I don't think works very well (due to the diminishing returns).

null @ 2018-12-11T18:15 (+5)

I'm not trying to target a straw man. I'm trying to speak to a line of thought that feels alive in the EA community – something along the lines of "giving effectively is a project worth expending substantial effort & resource on."

Alongside this view is a corollary, something like:

Giving effectively will be good, both for you and the people you're helping.

I think this corollary is often conveyed implicitly, but feels real regardless.

This corollary seems underspecified. I think giving effectively (and giving a lot) will be roughly as good for you as doing any giving at all. I think a more accurate version of the corollary would go something like:

Giving effectively will be about as good for you as other types of giving, but giving effectively can be more demanding than other types of giving. So there's often a tradeoff between your personal happiness & effective giving, especially if you're giving large amounts out of an income less than $115,000.

It's quite possible that EA leaders already agree with this amended corollary, in which case all I'm advocating for is being clear about the happiness<>giving tradeoff.

(And in the case where folks disagree with the amended corollary, I'm advocating for something like "this tradeoff is real & we shouldn't paper over it.")

null @ 2018-12-11T18:44 (+2)

I don't think life evaluation is the right measurement of happiness for this though. I'm pretty egotistical and more income would definitely make me happier, well beyond the threshold here. I make about 100k/year and would definitely be more satisfied with my life if I made 200k. But, that's purely from a "feeling like a success"/social status standpoint. I have no realistic lifestyle use for 200k. I can't even figure out how to use 100k on lifestyle because the things people typically buy are really boring. So even though making more money would make me happier, spending more of it on myself wouldn't. Positive affect is better but may still be affected too much by life evaluation. So negative affect is probably the best measure, since it's more related to the possibility of suffering due to insufficient money.

null @ 2018-12-11T18:49 (+1)

I think you're approaching an interesting point on the earnings curve. Probably making $200k and giving away $100k would be more satisfying than earning $100k and giving away $1,000 (wildly speculating here).

I'm not sure that making $100k and giving away $50k of it would be more satisfying than earning $50k and giving away $1,000 though. After reflecting on it for a minute, I think it probably would be, but nowhere near 50x. And you'd be leaving a lot of other happy-making possibilities on the table if you gave away $50k out of $100k (which seems less true for giving away $100k out of $200k).

Closed Limelike Curves @ 2022-09-28T19:04 (+1)

>The egoistic motivation for donating is highly scope insensitive – giving away $500 feels roughly as good as giving away $50,000. I haven’t found any academic evidence on this, but it’s been robustly true in my experience.

There's academic evidence and it disagrees; the amount of donations matters. (It's nonlinear, but so is the effect of spending on anything.) I suppose you could probably increase it by giving smaller amounts more frequently--having a tiny notification on your computer that goes "Congrats on donating $10!" or whatever.