While finishing off the fourth chapter of my book (in which I explore the links between happiness and grades) I came across an interesting academic paper written by Nattavudh Powdthavee, a socio-economist at the University of York. The paper is titled, ‘Putting a Price Tag on Friends, Relatives and Neighbours’ and in it, Powdthavee uses a method called shadow pricing to assign monetary values to a number of social phenomenon.

Shadow Pricing Explained

How does shadow pricing work? The statistical maths behind it is a little complicated but the basic idea can be illustrated with the following example: Let’s say you are earning £10,000 a year. At this point you may rate your happiness to be a six, on a scale of one to ten. However, the following year you get promoted and your salary is increased to £30,000. When you are asked how happy you are, you now reply with a happiness rating of eight. Assuming nothing else contributed to your happiness, one could infer that to increase your happiness by two points you require £20,000. Now, what if in another situation instead of an increase in salary, you got married and your happiness did also move from six to eight. One could then infer that the shadow price of marriage is £20,000.

Powdthavee’s methadology is more sophisticated than my example implies, and uses data from the British Household Panel Survery, which includes over 10,000 randomly selected individuals. What you get from such enormous data are estimates and valuations which are eye-opening. Powdthavee estimates, for instance, that if you move from seeing your friends or relatives less than once a month to seeing them on most days (more than twice a week), your life satisfaction could improve just as much as if you were handed £85,000!

What is the significance of this number? And why should we put ‘price-tags’ on friends? Well, for one, this figure is a reminder of how important it is to have a healthy social life if you want to be happy (and don’t forget, happy people often outperform sad people in a number of fields, including education). Secondly, such estimates can help with decision making. For example, when you graduate you might be faced with the dilemma of choosing between a high-paying job which requires you to relocate far away from your friends and relatives, and a lower-paying job nearer home. But with a monetary estimate of how much your social life is worth, you can make better-informed decisions in situations such as these.

Here are few other interesting estimates in Powdthavee’s paper (the reds are negative values):

• Seeing friends/relatives once or twice a month: £57,500
• Seeing friends/relatives once or twice a week: £69,500
• Seeing friends/relatives on most days: £85,500
• Marriage: £50,500
• Living as a couple: £82,500
• Unemployed: £143,000

The reason why we see so many rat racers around is that our culture reinforces this belief. If we get an A at the end of the semester, we get a gift from our parents; if we meet certain quotas on the job, we get a bonus at the end of the year. We learn to focus on the next goal rather than on our present experience and chase the ever-elusive future our entire lives. We are not rewarded for enjoying the journey itself but for the successful completion of a journey. Society rewards results, not processes; arrivals, not journeys.

Once we arrive at our destination, once we attain our goal, we mistake the relief that we feel for happiness. The weightier the burden we carried on our journey, the more powerful and pleasant is our experience of relief. When we mistake these moments of relief for happiness, we reinforce the illusion that simply reaching goals will make us happy. While there certainly is value in relief—it is a pleasant experience and it is real—it should not be mistaken for happiness.

Excerpt from Happier by Tal Ben-Shahar.

Photo credit: James Clar.

Select your niche. It is very difficult to succeed in a crowded field. I have found that you can move more rapidly if you select a segment of that crowded field and become an expert in it. For example, the field of law is very crowded. A new attorney entering as a general business attorney will find slow growth. But a new attorney selecting a niche such as sports law will have the opportunity for rapid growth.

Search out that special growth segment in your field and become an expert. You will grow more quickly than you can imagine.

Excerpt from If I Knew Then What I know Now by Richard Edler.

The first time I heard ‘Bright Life‘ (a song by Rie Fu), the following line resonated with me so much, I had to blog it:

Try not to think about getting credit for doing what you were born to do.

Why? Because the need to bask in glory and praise can get in the way of doing authentic work.

The CV, in its traditional form as the sole source of information about a candidate is on its way out. Virtually everyone has an online persona these days and it should come as no surprise that people and employers alike, will google you more frequently in the not so distant future.

According to a Microsoft study, in the UK alone more than half of recruiters and HR professionals believe that in 4-5 years time online reputation data will  be used in the recruitment process all or most of the time!

What will they find if they search for your name? Will it help or hinder your chances of success?

To some extent, we have no control over what other people write about us (and this turns up in google results), but we do have control over what we write and produce online.

So why not take the power in your hands, buy a domain of your name (www.myname.com), and create an online CV or  free blog with wordpress for example?

The future is that our online personas will be so intertwined with our real personal lives that when it comes to people wanting to get to you know you, the first thing they will do is google you!

We all spend money on clothes to look nice when we go out, so why not spend some time and money on looking nice when we go online?