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Norton says money can buy happiness

Posted June 3, 2008 8:04 AM by Ted Jackson

In the March 21, 2008 issue of Science magazine, Harvard professor Michael Norton, not to be confused with Balanced Scorecard co-creator David Norton, published his findings that money can buy you happiness. I certainly was intrigued when I read this news in a Harvard Business School's Working Knowledge interview earlier this week.

According to Professor Norton's research, making more money does not make you happier, but spending money on other people does make you happier. To summarize his work quickly, he concluded that when people gave money to other individuals or to charities, that it made them happier than if they spent the money on themselves. In his study, he even showed that if people knew about his research, it didn't affect the study, that people were still happier after giving away money.

OK, so why is this interesting? It is interesting because in the Working Knowledge interview, Ms. Gilbert asked professor Norton what he was working on next, and he said that he was looking at the "prosocial workplace" phenomenon. This is where companies that have the knowledge of this study, then allocate their corporate philanthropy dollars to individual employees who then research and "spend" the money on charities. This creates happier and more engaged employees.

So if you are a charity that relies on corporate giving, it is going to be important to watch this trend. My blog before this spoke about an SSIR article related to performance management. In that article, the authors spoke about monitoring your donors. If you rely on corporate donations, this is a good example of something to keep track of.

I'd be interested to hear if anyone has run into the prosocial workplace yet.