What is a 'Hedonic Treadmill'

A hedonic treadmill (also called hedonistic treadmill and hedonic adaptation) is the tendency of a person to remain at a relatively stable level of happiness despite a change in fortune or the achievement of major goals. According to the hedonic treadmill model, as a person makes more money, expectations and desires rise in tandem, which results in no permanent gain in happiness.

BREAKING DOWN 'Hedonic Treadmill'

The hedonic treadmill theory explains the often-held observation that rich people are no happier than poor people, and that those with severe money problems are sometimes quite happy. The theory supports the argument that money does not buy happiness and that the pursuit of money as a way to reach this goal is futile. Good and bad fortunes may temporarily affect how happy a person is, but most people will end up back at their normal level of happiness.

What Is a Hedonic Set Point?

In psychology, a hedonic set point is the general baseline level of happiness a person experiences over their lifetimes, despite any temporary changes in the level from positive or negative life events. The theory argues that although events and environmental factors can affect happiness in the short term, people will naturally adapt back to their hedonic set point in the long term.

Studying the Effects of the Hedonic Treadmill

An interview-based study titled "Lottery Winners and Accident Victims: Is Happiness Relative?" that was published in 1978 by Brickman, Coates, and Janoff-Bulman set out to determine how people adapted to happiness. The researchers interviewed three groups of people: lottery winners, paralyzed accident victims, and a control group.

Based on their findings, the newly-rich lottery winners were shown to have similar levels of happiness before and after winning. This indicated that there wasn't a consistent relationship between increased happiness and personal financial gains, and that the baseline level of happiness for the lottery winners over time would remain nearly the same.

According to the study, "Although lottery winners felt very good about winning the lottery, they took less pleasure than controls [group] in a variety of ordinary events and were not in general happier than [the control group]. These results can be derived from an adaptation level analysis of the effects of a single extremely positive event."

The study also showed that the group of paralyzed accident victims expected their level of happiness to increase to the baseline over time, despite an initial decrease in happiness from their negative life event.

RELATED TERMS
  1. Hedonic Regression

    Hedonic regression is a method used in economics to determine ...
  2. Lottery

    A lottery is a low-odds game of chance or process in which winners ...
  3. Utilitarianism

    Utilitarianism is a moral theory that advocates actions that ...
  4. Event Study

    An event study is an empirical analysis done on a security that ...
  5. Baseline

    A baseline is a benchmark that is used as a foundation for measuring ...
  6. Adaptive Selling

    Adaptive selling is a tailored client centric approach to selling, ...
Related Articles
  1. Personal Finance

    3 Habits Happy People Use in Financial Planning

    Following these three habits can help make you more financially sound, and potentially happier.
  2. Insurance

    Ways Money Can Buy A Little Happiness

    Money can't buy happiness for everyone, but it may be able to buy you time, security and experiences.
  3. Investing

    States That Spend The Most On Lottery Tickets

    Here are the areas in the U.S. that spend plenty of money on lottery tickets.
  4. Personal Finance

    Optimize Your Spending to Increase Your Happiness

    It's not about how much money you have or make, it's about how you spend it.
  5. Retirement

    Top Tips for Helping Clients Sustain Wealth

    High-net-worth individuals face a number of potential challenges when passing wealth down, but it is possible to build generational wealth.
  6. Personal Finance

    When Higher Income Doesn't Lead to Increased Happiness

    The happiness that comes with increased income is often negated by increased debt.
  7. Insights

    How to Find Happiness Through Work

    Besides earning more money, doing these things can foster financial and emotional health.
  8. Financial Advisor

    How to Budget and Spend to Maximize Your Happiness

    Spending money on others and buying experiences are just two of the five key principles that lie in money correlating to happiness.
  9. Managing Wealth

    How the Green Card Lottery Really Works

    Here's how the popular green card lottery, run by the U.S. State Department, operates, including some tips on improving your odds of winning.
  10. Financial Advisor

    6 Hidden Government Revenue Streams

    You may be well aware of the tax dollars the government withholds from your paycheck, but this isn't the only way your income is being tapped.
Trading Center