Tim Worstall explains that the so-called Easterlin Paradox — that economic growth did not make people happy — is clearly not supported by the evidence:
As background here: the basic paradox that Easterlin pointed to is that, past a certain level (roughly when we’ve become rich enough to solve the supply of basic creature comforts like food, shelter, clothing etc, something like a GDP per capita of $15,000 say), a country getting richer doesn’t seem to make the population any happier. While we’ve now got rather better data than he could work with, and thus we know that people do keep getting happier but at a much lower rate, that basic idea has proven very popular. Of course it has: for it’s allowed all sorts of people to argue that we don’t have to chase that Great God, GDP, and we can thus do things that make people happier and not richer. It’s a lovely argument to use when someone objects that taxing the heck out of the rich will reduce growth for example. For one can just riposte that more growth wouldn’t make people happier while taxing the heck out of the rich would. It’s used as the opening argument in The Spirit Level in this manner: as higher GDP doesn’t make people happier we can therefore concentrate upon inequality instead. And there’s many other such uses around and about.
I’ve never thought that was quite right and I said so. My argument being that it’s not the level of economic wealth that makes people happy or unhappy (above that basics level that is). Rather, it’s the direction of change of it. If a country is gradually getting richer then people will be happier than if the economy is stagnant or shrinking. And the association of greater happiness with the richer countries is not really because they are richer, but because in becoming rich those countries have obviously had decades, if not centuries, of gradually rising incomes: that very thing that makes people happy.