More Money Can Mean Less Happiness for Neurotics
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Add one more item to the things that torture neurotics: a pay increase.

While more money doesn't guarantee more happiness for anyone, increasing income is actually associated with less happiness among neurotic people who already earn a good salary. In fact, as pay increased, well-off neurotics are less happy than their non-neurotic peers, survey data indicate.

For poor neurotics, however, increasing income has the opposite effect: They become happier than their non-neurotic peers.

A new study offers an explanation for this complicated relationship, suggesting it's all about expectations.

Using survey data collected in Great Britain and Germany, two researchers looked into how personality influences the relationship between income and life satisfaction. They focused on the effect of neuroticism, one of the five primary domains psychologists use to classify personality.

Neuroticism is linked with high sensitivity to negative emotions such as anger, hostility and depression, write the researchers Eugenio Proto, of the University of Warwick in England, and Aldo Rustichini of the University of Minnesota.

Previous research associated this personality trait with sensitivity to negative outcomes, threats and punishments. [7 Thoughts That Are Bad for You]

"It is therefore reasonable to argue that people with higher neuroticism experience higher sensitivity to losses or failure to meet the expectations," Proto and Rustichini write.

The reason lies in how neurotics perceive the gap between what they hope to earn and the reality, the two researchers suggest. As such, a pay increase is seen as a measure of success.

"When they are on a lower income, a pay increase does satisfy them because they see that as an achievement," Proto said in a statement. "However, if they are already on a higher income, they may not think the pay increase is as much as they were expecting. So they see this as a partial failure and it lowers their life satisfaction."

The finding is detailed in a working paper for the University of Warwick Centre for Competitive Advantage in the Global Economy.

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