Look at Stuarts figure #1: practically all of those countries left and down are former Socialist countries. If you remove those from the graph, you get much more clear correlation between GDP per capita and happiness. Common to those countries is an experience of a deep economic crash. When you are going down you don't feel very happy. Nigeria is left and up - oil and gas is bringing some economic upward trend.

Besides, the horizontal axis should be median income - we don't  weight happiness answers with persons income.

From the experience of the former Socialist countries we can conclude that we will not be happier after the Peak Oil induced recession.

And every marketing expert will tell you that people don't always behave like they say. Perfectly happy people will still try to get more income, even if it seems that they cannot be more happy.

I appreciate the effort to explore the relationship between happiness and "having more or less" but I do wonder about the methodology behind the graph as well.

For example, who was interviewed in nigeria and how?  Were people who have been displaced by the oil and gas industry in the Niger Delta interviewed?  Were top officials in the corrupt government or industry interviewed?

For country after country what seems to matter is the particulars of individual life stories and situations within the context of that county's larger economic story.  Add to this the possibility that other "larger" narratives -- religion, faith in progress, hope for some specific reward or betterment -- can make a difference in one's happiness.

I agree that wealth does not make one happy!  I agree that we need to explore the topic like this.

What are the premises we bring to the discussion, and are we aware of them?  How do our premises affect our conclusions?

The Nigerian interviews were done in 2000, before the oil price spike and evidence of social unrest. You can play around with the data yourself at worldvalue website. The total 1999/2000 wave above included in depth interviews and surveys from over 98,000 people. I dont think asking someone how happy they are is the final arbiter on if they really are or not.  But social scientists tell me this was one of the better done, scientifically approached surveys of its kind. I was more interested in the broad brush trend of happiness/energy. As Prof Goose states, social capital is indeed very important -

I suspect perceptions of happiness have much to do with self-comparisons versus a recent baseline- how ones life is versus how it was a few years ago - so perhaps the 2005-6 wave will show that former Russian countries are happier, since they had their energy drop off long ago, and have now equilibriated to it.

It does seem to me that TI's point is a very good one. That whole lower left leg of your figure is made of ex-communist countries who probably weren't too happy to begin with as they lived in communist dictatorships, and then had their happiness further enhanced by the collapse of their system.

I also note a few interesting relationships like Ireland > UK > Germany, and the whole thing makes me think it would be very interesting to look at the relationship of happiness to growth rate (in either GDP/capita or energy/capita). Given that humans have a strong tendency to get used to conditions as they are, changes in level could be more important to happiness than the actual level.

Given that humans have a strong tendency to get used to conditions as they are, changes in level could be more important to happiness than the actual level.

Good point.  There was a recent study done that found the wealthier you are, the less happy are.  (Assuming basic needs are met.)  The reason, the researchers claimed, was that the more you have, the less there is that can make you happy.  For example, I would be ecstatic if I won $50,000 in the lottery.  Bill Gates would barely notice.  

OTOH, they've also found that in the long term, we all have a "happiness setpoint" we tend to return to.  They studied people who had something wonderful happen to them, and people who had suffered something terrible.  For example, people who won the lottery, and people who got permanently paralyzed in an accident.  Good luck did make people happy for awhile, and bad luck made them depressed, but after about three years, they were back to normal.  The naturally happy were happy, the naturally crabby were not.

Stuart, this analysis used the mutually intersecting countries of the worldvalues site and the britishpetroleum data - there were far more countries in each but I only used ones that had data for both. With more time I could have found energy per capita for the entire worldvalues 1999/2000 wave.

Eventually Ill get to it