Part of the pleasure you feel during shopping comes from being able to get something. Whether this is a new pair of designer jeans or a new dress, purchasing something new and exciting triggers a complicated chemical reaction in your brain. When you shop, your brain evaluates the products around you, deciding whether it thinks you should buy them. If you feel your brain shouting “go!”, this is your brain producing dopamine. This chemical activates your reward system; the connected regions of your brain that forge links between objects and pleasure. The irresistible impulse to take those sunglasses to the counter and hand over your card is the rewarding effect of dopamine. Dopamine is also involved in addiction. For example, taking certain drugs releases dopamine in your brain, and this sensation is what people get addicted to. For some people, shopping can also become an addiction. However, most people can simply enjoy shopping without becoming addicted. It only becomes an addiction if you can’t prevent yourself from buying things even when the consequences are negative, for instance when you don’t have enough money and have to take out loans to fund your excessive spending.

Picture the t-shirt you bought in the sales last summer. The original price was way too high, but after months of waiting, it was finally marked down by 70%. Do you remember how pleased you felt? Sales have a special way of making us happy and making us value the objects we buy even more. The reason for this is that when you shop, you do a cost-benefit analysis, where the value of the good is compared with its price. When the price is lower, the good has a lower threshold to convince you to buy it. This means that it’s more likely that you will find something to buy, and therefore more likely your brain will get to experience that exciting burst of dopamine. You even get the added excitement of knowing that you paid a lot less than other people for the same item. Finally, an object on sale is surprisingly better than expected for an item of this price, increasing the release of dopamine. Dopamine is sensitive to your expectations. So if you don’t expect that you'll be able to afford the t-shirt but you find it on sale, it feels better than if you already knew you would have it. This element of surprise triggers more dopamine to be released in your brain and makes you feel even happier. 

Sales, special offers, pop-up stores and limited editions create an opportunity effect. If you don’t buy the object now, you might not have another opportunity to find the product at a later date. These events create a limited supply environment. This is a context in which there are a small number of goods, for example only 1000 pairs of trainers with a specific design. There are two main effects of a limited opportunity for purchasing. First, it makes the things you buy more special because fewer people might own them. This is the scarcity effect: the value of the object increases with the difficulty of obtaining it. It feels great to buy something you know other people would have a hard time to find. Second, a limited purchasing window makes it more likely your brain will decide that now is the time to flash the cash. This is due to the fact that most of us are loss averse. This means that we are sensitive to missing out on the opportunity to buy something, worrying that we will subsequently regret the lost chance to buy a product.

People often use their clothing to demonstrate their belonging to a specific social group, for instance, geeks, goths skaters, or hipsters. Buying a specific object or outfit can be a way to ‘fit in’, and to be accepted within a group. It can also be a way to display your wealth (“I can afford it!”) or style (“I’m cool!”) to the people around you.  Wearing new and cool clothing can make you feel more self-confident and encourage you to interact with others. It can also be a way of gaining attention and approval. That’s why shopping can be seen as a way of establishing your identity and boosting your self-esteem, which definitely feels great!

The rules of shopping are simple. You hand over your money and you get something to wear in return. Compared to a lot of situations in life, such as school, interacting with friends, or dealing with your parents, this is a very straightforward situation. You are the centre of the decision, and you can express your preferences easily. There is no uncertainty regarding whether or not you will receive your reward. You’re in complete control. People in shops are usually friendly and aim to encourage you to buy their products. They compliment your taste or looks to make you feel good. This attention and praise gives you further control and gives your confidence a boost. You feel both accepted and encouraged. Shopping can, therefore, become a compensatory strategy, providing reassurance and a lift when you feel insecure or sad. 

Experts think that freedom is one of the key things that makes us happy. But what does this actually mean? It can surely mean anything from being able to move around as we like, to being able to choose our friends and the school we attend, to expressing our opinions openly. Freedom is such a big concept that scientists have had a hard time trying to trace its connections to happiness. But they succeeded by asking people questions about how free they feel in their personal and professional lives. The other aspect of freedom is linked to democracy (a governing system where the public can vote and have their say). Some north European countries like Sweden and Norway that compete for the top place in the United Nations Happiness Index every year, have some of the strongest democracies in the world. These are countries that respect human rights and where citizens overall feel that the government does not place restrictions on their lives. Instead, it helps them to improve their future life chances freely. On the other hand, countries that score poorly – such as Burundi and the Central African Republic – are at war and human rights and personal freedoms don’t exist. 

Winston Churchill famously said that ‘We make a living by what we get. We make a life by what we give.’ What he meant was that although we get paid for the work we do, it is when we share our money and time with other people that we truly enjoy life. Now there is scientific evidence to prove this, i.e. that charity makes us happier. For example, Nordic countries like Norway, Sweden, Finland, and Denmark have some of the most generous social safety nets that help the poorest members of their society. In a social experiment, researchers dropped stamped and addressed envelopes in public areas to see whether people would put them in a mailbox. It is a kind act of help and generosity to invest that extra bit of time and effort to send the mail back. In countries where the most mail was returned (like Switzerland), live some of the happiest people. You may say this is ultimately linked back to money since the wealthier people are, the more free time they have to mail the envelopes back. Although that is certainly true (and some of the most generous countries in the world are also the richest), generosity – according to this study – makes people happier everywhere.

Access to good health systems is an important factor why people in Norway, Denmark, Switzerland, the Netherlands, and Canada live some of the happiest lives. Good quality medical care and access to treatment for everyone is an important part of our life. In societies where medical care is expensive, such as the United States, falling ill may ruin families and lives. Instead, in countries where general insurance exist and people can be sure that they will be taken care of when they fall ill, quality of life overall improves and happiness increases. Countries with poor health systems such as Russia rank low in world indices of happiness. Even among developed countries healthcare matters in different ways. Experts say that in rich countries, the biggest single cause of misery is depression and anxiety. In wealthier countries, mental health comes first and physical health only second. In poor countries, it is the other way around, and improvements in physical health make people a lot happier.

How happy and confident we are depends on who our friends are, how many friends we have, and how closely we relate to the people that surround us – in our homes, workplaces, neighbourhood etc. Having someone to count on is good but having several circles of friends and social circles is even better. Experts say that social support not only makes us happy but also directly affects our physical and mental health. For example, in most polls, married people across the world claim that they’re happier than single people. A stable family life contributes to happiness. Nations that have top happiness ranking such as Norway and Denmark are famous for their community activities and how they cherish sharing activities with friends and family. These are also countries where women are treated equally and are offered extra support when they care for their children. The welfare system in place is another good indicator of happiness: the more people are willing to support each other through higher taxes, the happier they seem to be overall. Why? Because they don’t need to worry as much about unemployment, child care, and falling ill. They know that there’s a social safety net to support them.

Money matters but not as much as you might think. In developed countries like the UK, Germany, and the US, most people have living standards far above basic material needs. Only in the very poorest countries, where people live below the poverty line does income make a big difference to the overall quality of life. A country's economy can be measured by totalling everything produced by all the people and companies working within it - known as its Gross Domestic Product score (GDP). The Central African Republic, a country with a low GDP score (306) was ranked as the unhappiest country in the world in 2017. While, Norway, a country with a GDP score of 74,500, topped the list. After a certain point, extra income doesn’t buy extra happiness, experts say. For example, an extra £100 of salary is worth much more to someone poor than to someone already earning a lot. Once we can afford all the things we need, we don’t get much happier by earning more. So the relationship between money and happiness is positive but not always. For example, the World Happiness Index suggests that although people in Norway have gotten somewhat poorer, they have actually become happier. And vice versa: In China and in the US, people have been becoming richer but they are no happier than 25 years ago. It seems that happiness varies more with the quality of human relationships than with income.

Societies where people trust each other and the government tend to be happier places to live. Trust can be a tricky concept to measure. The European Social Survey measures trust both among people and in institutions in a detailed questionnaire that includes questions from how much you trust your friends to whether you think someone would return a cash-stuffed wallet. The types of trust that matter the most are trust are among people (called social trust) and trust in the police. Social trust looks at how we trust our friends, colleagues, neighbours, and even strangers on the street. Experts also found out that social trust improves the overall levels of economic development and general mental health. Trust in the police is important because happiness increases with feelings of safety. We also get happier the more we trust in the legal system, in parliament, and in politicians. Levels of trust have fallen dramatically in the US and UK but risen in some of the happiest places in the world like Denmark and Germany. One explanation may be that Americans and people in the UK have recently been dissatisfied with their governments and economies but people in many continental European countries have been more satisfied. Especially in the US, experts think, rising inequality, corruption, and isolation among people rather than GDP have made people unhappier over the past few years.

If you do have cash, it’s possible that you’ll be happier if you spend it on someone else. In a study where people were given a gift card for a coffee shop, participants “were happier if they spend it on a friend rather than on themselves” explains Philosopher, Andreas Mogensen (University of Oxford). But this effect was only observed “if people took the time to go to the shop with the friend. This is likely because buying something for someone else in person means you’re spending time with them and seeing their reaction – and it all reinforces your good relationship with them. Social closeness and connectedness to others may be key in generating significant benefits from spending money on others,” he explains.

The 14th Dalai Lama suggests that, in line with Buddhist thinking, happiness is less about pleasure and more about internal (or deep) satisfaction. This is to do with changing the way we think and act towards people around us. For example, he advises that we should remain ‘warm-hearted’ and help others whenever we can. This will give us a greater sense of purpose. “We are social animals… friendship is essential”, and we should try to see ourselves as equal to other people. He explains that none of this is linked to what we own or spend our money on as this can lead to jealousy and frustration, and move us away from satisfaction.

Part of the pleasure you feel during shopping comes from being able to get something. If you feel your brain shouting “go!”, then it's likely producing dopamine. This chemical activates your reward system; the connected regions of your brain that forge links between objects and pleasure. Dopamine is also sensitive to your expectations. So if you don’t expect that you’ll be able to afford a particular t-shirt but you find it on sale, it feels better than if you already knew you would have it. This element of surprise triggers more dopamine to be released in your brain and makes you feel even happier.

Although there’s lots of research still going on, some studies suggest that there’s a cut-off point – once you earn a certain amount of money (around £58,000 per year), you don’t necessarily feel happier the richer you are. Once we can afford all the things we need, we don’t get much happier by earning more. So the relationship between money and happiness is positive but not always. For example, the United Nations World Happiness Index suggests that although people in Norway have gotten somewhat poorer, they have actually become happier. And vice versa, in China and the US, people have been becoming richer but they are no happier than 25 years ago. It seems that happiness varies more with the quality of human relationships than with income.

Life is expensive from paying for where you live to food shopping to paying the bills. A baseline amount of money is ideally needed to ensure that these costs are covered and each month isn’t a constant struggle.

According to the United Nations Happiness Index, income is just one of several things that contribute to our overall happiness. Our freedom, access to good health services, strong social support and community networks, and trust in the police and Government are all very important factors too.