On any day, the rich tend to be a bit happier than the poor, but increases in average living standards don’t seem to make people happier. the average american’s income is up 80% since 1972, but the percentage describing themselves as “very happy” (roughly a third) hasn’t changed. as living standards increase, most of us respond by raising our own standards: things that once seemed luxuries now are necessities and we work harder to buy stuff that satisfies us less and less.
source: cnn, october 1, 2004
according to the news clip,
• how do widespread increases in living standards influence total utility?
• how do total utility and marginal utility from consumption change over time?