Chapter 2: Does wealth really make happy?





0th The problem

1st Happiness versus contentment

2nd Hedonism versus Stoicism

3rd The attitude of Christianity towards wealth

4th Different objectives: wealth, power, prestige

5th The importance of the past for today's contentment

6th The role of expectations in today's happiness

7th Frustrations as a result of unfulfilled expectations

8th The role of education

9th Contentment depending on the wealth of others?



0th The problem


According to a widespread opinion, wealth makes happy. We humans have needs and desires and almost all needs and goals require material goods for their satisfaction and realisation.


And this is true irrespective of the moral value of a goal; it is by no means the case that morally high goals do not require material goods and that amoral goals consist precisely in the fact that their satisfaction requires a high material input. There are morally very high goals, such as helping people who have lost everything due to natural disasters. This goal even requires a very high material commitment. And there are morally reprehensible goals, such as bullying, which can also be realised without material goods.


Thus, if material goods are needed for most of our goals and needs, one would think that the richer someone is, the more he can satisfy his desires and become happy. And that therefore, with the wealth of individuals, individual happiness also increases.


But is this really the case? Doesn't this conclusion contradict everything we encounter in everyday life? Don't all of us know acquaintances who can be described as extremely poor in terms of their income and possessions, but of whom one has the impression that they are nevertheless quite content with their lives and do not bemoan their fate?


Of course, it is true that contentment certainly presupposes that the individual has a minimum of material goods. The so-called subsistence minimum summarises all the material goods that are indispensable for a life worthy of a human being. And in this sense, of course, we have to state that being happy indeed presupposes a minimum of material goods. But once this threshold of human existence is crossed, it can no longer be said that happiness increases to the extent that the individual has more income or wealth.


On the contrary, in our daily lives we experience again and again people who were particularly rich and who in no way showed signs of contentment and happiness, but rather went through their lives like hunted people and were not satisfied with what they had achieved so far, it seems as if, to the extent that the individual has more and more material goods at his disposal, he is subject to a compulsion to accumulate even more wealth.


On the face of it, this experience also seems to be consistent with a basic premise of economic theory, which assumes that entrepreneurs generally strive to take advantage of any possible increase in profits and that entrepreneurial behaviour, at least in a market economy, could be described as profit maximisation.


I have repeatedly pointed out elsewhere that such an interpretation of the assumption of profit maximisation completely misses the point of this assumption. That this assumption is less a hypothesis about the ultimate motives of entrepreneurs than primarily circumscribes the incentive system of a market economy (albeit only under certain conditions).


At this point, however, it is of greater importance that if one were to take the profit maximisation hypothesis as a fundamental motive, this assumption would come into conflict with another fundamental theorem of economic theory: namely, the law of diminishing marginal utility.


According to this first Gossen's law, the utility of a good increases in absolute terms with each new unit of consumption up to the so-called saturation limit, but the decisive factor is that the increase in the utility of the last unit of the good consumed becomes smaller and smaller until it finally drops to zero and, under certain circumstances, even turns into misuse (harm) with further expansion of consumption.


This was the first law named after Gossen, which initially referred to the individual units of goods consumed, but was later also applied to the entire income, so that the increase in utility decreases more and more with increasing income and falls to zero at a certain level of income.


According to this law, one would actually expect that people, when their income is still low, work towards increasing their income to a high degree, but that as the income increases, the attempt to still further increase the income automatically decreases.


This assumption applies above all because leisure time is also a good - albeit an immaterial one - and gainful employment is usually associated with an automatic decline in leisure time. If the law of diminishing utility growth also applies to the good 'leisure time', then the attempt to increase one's income through more gainful employment - and that also means through less leisure time - would automatically lead to an increase in the loss of utility of leisure time, which in turn would have the consequence that with growing income (with diminished leisure time) the benefit gain in net terms decreases strongly.


The question is now why we repeatedly observe in reality that the particularly rich just do not stop striving for further increases in income, but quite the opposite, they even increase their efforts aimed at increasing their income? Those who are rich obviously want to become even richer.


The opinion that wealth makes people happy seems also to contradict the fact that people who have suddenly become rich, even 'filthy rich', through a lottery ticket, are very often impoverished again after a few years, because they have obviously not understood how to divide their wealth in such a way that they are provided for their further life, although they should actually have been particularly happy forever.


Even if we neglect these correlations for a moment, i.e. tacitly assume that growing wealth is accompanied by the goal of making less and less effort for further acquisition and now using the precious time to enjoy the wealth acquired in the past, these pipe dreams are often abruptly ruined by the fact that others envy the wealth of the few and destroy the happiness of the super-rich through theft, blackmail and even kidnapping.


Thus, we come to the conclusion that the opinion that wealth makes people happy in any case is certainly wrong in this simple form. That while wealth can presumably contribute to making people happy, the connection between happiness and wealth is much more complex, that wealth is neither sufficient to make people happy in every case nor is wealth necessary to become truly happy.



1st Happiness versus contentment


Before we take a closer look at the thesis that wealth always, or at least usually, makes people happy, let us first take a brief look at the term 'happiness'. In general, this word is not only meant to express that the person who has experienced happiness is doing well all around; rather, this term is usually associated with a special positive feeling that the individual experiences - sometimes to the point of exstasy - and that puts him or her in a state that makes him or her forget all everyday worries.


I am not sure whether there are really many people in this sense who have ever encountered this state, and certainly not forever, or at least not for a long time. I also have my doubts as to whether such a state is desirable at all.


I would therefore rather speak of contentment in this context. This term is based on the assumption that people are usually torn between quite different needs and goals, that very often their own goals and desires come into conflict with the commandments of the community, and that contentment then means that the contented person can now control this conflict, that he has found a solution with which he is at peace within himself, so that peace has come to his soul.


Although we must also assume here that, in general, contentment is a state that by no means encompasses all people - or the majority of them - perhaps only a very select few reach such a state that they can say of themselves that they are now completely satisfied. And even then, if an individual has ever reached this goal completely - he will almost always only approach this goal more or less, without ever having reached the goal 100 per cent - he cannot expect that this mental state will now last forever, he can rather be dissatisfied with himself and the world again to a high degree shortly afterwards.


But at least we can assume that a much larger proportion of humanity has nevertheless managed to be content, at least temporarily, than one can find people who are happy all around. Above all, for many more people the goal of contentment is probably also much more desirable than the goal of becoming happy.



2nd Hedonism versus Stoicism


If we ask for the reasons why wealth should make people happy, then the hedonistic doctrine, which was developed by Jeremy Bentham among others, comes closest to this thesis.


Jeremy Bentham is one of the English early liberals and the hedonism he advocates is not only based on the thesis that people in general strive for the highest possible pleasure and align all their actions to this maxim, this rule of behaviour is also declared to be a basic ethical principle, according to which it is also one of the most important goals of a community that as many people as possible, or at least most people, experience a maximum of benefit, whereby benefit is largely equated with emotional pleasure.


And if we now take into account that individuals experience benefit through the consumption of goods and, because of the scarcity of material resources, can only acquire goods by having income or wealth, then the hedonistic doctrine can also be interpreted in such a way that happiness ultimately depends on income and wealth and that wealth then indeed brings about a maximum of utility and in this sense makes people happy.


Stoicism takes a counter-position to hedonism. Among the leading Stoics were Zeno of Tarsos and above all Seneca. Stoicism was the most respected philosophy during the Roman Empire before Constantine the Great had declared Christianity to be the state religion.


If one asks about the ethics of the Stoics, it is above all about bringing life into harmony with the totality of nature, the obedience to the divine law and the duty of reason that it pronounces. Based on this conviction, the Stoics also developed a theory of the laws of nature, which led to a strong influence on Roman jurisdiction.


According to Stoicism, the good of the individual does not lie in external objects, but in the state of the soul itself. Therefore, the four cardinal virtues of Stoicism - derived from Plato - are: wisdom, courage, justice and moderation.


And if we also try to assign Stoicism to our conceptual pair: happiness versus contentment, then it is not so much pleasure-based happiness but contentment that is in line with the goals of the Stoa. Those who strive for contentment assume that the nature of man is based on conflicting needs and goals and that man can only master his life if he can overcome this inner conflict and find peace between these conflicting mental impulses.



3rd The attitude of Christianity towards wealth


Now what is Christianity's position on the thesis that wealth makes people happy? If one consults the Bible to answer this question, one immediately thinks of the biblical passage in Matthew chapter 19, which deals with wealth and the discipleship. There it says:


23 Then Jesus said to his disciples: “Truly I say to you that it will be difficult for a rich man to enter the Kingdom of the heavens.

24 Again I say to you, it is easier for a camel to get through a needle’s eye than for a rich man to enter the Kingdom of God.

25 When the disciples heard that, they were greatly astounded, saying: “Who really can be saved?”

26 Looking at them intently, Jesus said to them: “With men this is impossible, but with God all things are possible.”


On the surface, one could draw the conclusion from this text that people could only attain eternal happiness at all if they completely renounced wealth, and such a demand is the opposite of the idea that wealth makes one happy.


However, a more in-depth study of this biblical passage reveals that the conclusions to be drawn from this Bible passage are somewhat more complicated.


The first thing we have to bear in mind when interpreting this biblical passage is that Jesus uses a form of expression common in the Orient to formulate truths in a pointed way in order to shake his listeners awake and to induce them to repent. For this purpose, no highly scientific treatise is needed, but rather easily understandable, striking, perhaps even somewhat exaggerated formulations.


For instance, Jesus answered Peter's question, “Lord, how many times is my brother to sin against me and am I to forgive him? Up to seven times?” “…not up to seven times, but up to 77 times.” (Mt 18,21f.) However, he did not mean to express that forgiveness should no longer be granted at the 78th time, but that one should always forgive the sinner, provided he repents of his deed with all his heart.


Secondly, the meaning of a biblical passage can only be fully recognised if other biblical passages are consulted which also problematise the issue of wealth. However, the New Testament does indeed contain other passages that deal with the problem of wealth. The Gospel according to Luke, chapter 19, reports how Jesus stopped off at the rich tax collector's house:


1 He then entered Jerʹi·cho and was passing through.

2 Now a man named Zac·chaeʹus was there; he was a chief tax collector, and he was very rich.

3 Well, he was trying to see who this Jesus was, but he could not see because of the crowd, since he was short. 

4 So he ran ahead and climbed a sycamore tree in order to see him, for he was about to pass that way.

5 Now when Jesus got to the place, he looked up and said to him: “Zac·chaeʹus, hurry and get down, for today I must stay in your house.”

6 With that he hurried down and joyfully welcomed him as a guest. 

7 When they saw this, they were all muttering: “He went as a guest to the house of a man who is a sinner.”

8 But Zac·chaeʹus stood up and said to the Lord: “Look! The half of my belongings, Lord, I am giving to the poor, and whatever I extorted from anyone, I am restoring four times over.”

9 At this Jesus said to him: “Today salvation has come to this house, because he too is a son of Abraham.

10 For the Son of man came to seek and to save what was lost.”


So even though Zacchaeus was very rich and, moreover, had acquired this wealth by exploiting the Jews on behalf of the Roman occupying power, salvation was still given to him. Obviously, it is less important whether someone is rich, but how he uses his wealth, what significance his wealth has in his life. Because Zacchaeus assured Jesus that he repented of having treated Jews unjustly and that he was willing to make amends for this damage, salvation could also be given to him, even though he was still very rich.


In the parable of the rich man and poor Lazarus ( Gospel of Luke chapter 16, verses 19-31) we learn what the despicable thing about a rich man is:


19 'There was a rich man who used to dress in purple and linen, enjoying himself day after day with magnificence. 

20 But a beggar named Lazʹa·rus used to be put at his gate, covered with ulcers

21 and desiring to be filled with the things dropping from the table of the rich man. Yes, even the dogs would come and lick his ulcers.

22 Now in the course of time, the beggar died and was carried off by the angels to Abraham’s side. Also, the rich man died and was buried.

23 And in the Grave he lifted up his eyes, being in torment, and he saw Abraham from afar and Lazʹa·rus by his side. 

24 So he called and said, ‘Father Abraham, have mercy on me, and send Lazʹa·rus to dip the tip of his finger in water and cool my tongue, for I am in anguish in this blazing fire.’

25 But Abraham said, ‘Child, remember that you had your fill of good things in your lifetime, but Lazʹa·rus for his part received bad things. Now, however, he is being comforted here, but you are in anguish.'


In this parable, the rich man does not suffer terrible agonies after his death because he is rich, but because he disgracefully disregarded the commandment to love his neighbour (and according to Jesus, this commandment is, next to the commandment to love God, the most important commandment of all) and did not even allow the poor and seriously ill Lazarus the crumbs that fell from the rich man's table.


Thirdly, a more detailed analysis of the parable of the camel that does not pass through the eye of a needle shows that Jesus does not see wealth as such as an obstacle to attaining eternal happiness. Jesus begins this parable by pointing out that it is difficult for a rich person to enter the kingdom of heaven.


Difficult does not mean impossible, hence the rich man must make an effort to attain salvation. And if he makes an effort, then he can very well enter the kingdom of heaven after his death, just like the poor. And Jesus then continues: 'Again I say to you...' and this formulation clearly says that the content of the first sentence (it is difficult) is to be repeated again in other words.


And therefore, the comparison with the camel that does not pass through the eye of a needle cannot mean that it is just as impossible for a rich person to attain salvation as it is de facto impossible for a camel to pass through the eye of a needle. It is only intended to point out, by deliberately emphasising exaggeration, the certainly great difficulty of attaining salvation as a rich person.


And when the disciples heard this and were terrified and then asked in horror who else could be saved, Jesus looked at them and said to them: For men this is impossible, but for God all things are possible.


Thus, we come to the conclusion that while wealth is not at all the means for a Christian to attain blissful happiness, without wealth as such being an insurmountable obstacle to attaining blissful happiness.



4th Different objectives: wealth, power, prestige



In the following, we want to develop a counter-position to the thesis that wealth and only wealth leads to happiness. One of the main errors of the thesis to be criticised here is that it assumes as a matter of course that all people are equal and that it is assumed that people therefore all behave and should behave in the same way in their striving for equality.


Of course, it is true that in certain areas people are to be considered equal, but in other areas they are also unequal to such an extent that no individual is like any other individual in all respects.


And precisely with regard to the question of how people find happiness, there are considerable differences between people, almost every person has a different goal in life. And precisely because people have different needs and pursue different goals in this question, human nature is only met when this difference between individuals is fully recognised.


It should therefore be accepted that a maximum of contentment of all people can only be achieved at all if one accepts the diversity of the individual and also leaves it up to the individual to decide for himself/herself the way in which the individual achieves happiness.


Any attempt on the part of the state or society to determine, in a meritocratic attitude, how the individual is to be happy contradicts the essence of the human being.


And if we now observe, on the basis of these considerations, which life goals individual people set themselves in order to achieve happiness or better satisfaction in this way, we find that particularly three fundamentally different behavioural patterns emerge.


There is a first type of person whose main desire is indeed to acquire as many material goods as possible and of whom one can therefore assume that their primary goal in life is to become rich.


The prototype of this first type of person is the entrepreneur, who, according to liberal economic theory, strives to maximise his profit in all his actions.


However, this hypothesis is mostly misunderstood. This assumption says nothing about the ultimate motives that drive entrepreneurs to act. These motives may even consist of morally superior goals, such as making mankind happy by inventing an aeroplane or electric light.


Rather, the profit maximisation thesis primarily wants to say something about the incentive system of a free market economy. If there is intense competition between entrepreneurs on markets, as is essential for the smooth functioning of a market economy, the entrepreneur is forced to exploit all possible (and of course permissible) possibilities of increasing profits in order to hold his own against the competition.


But even when individual entrepreneurs achieve a monopoly position, they are often under an inner compulsion to look for more and more profit. This compulsion is related to the fact that precisely when an individual entrepreneur has acquired enormous wealth, there is a high probability that others will envy him this wealth and, because of these opportunities, strive to penetrate this market. From a morphological point of view, a de facto monopoly position - as Friedrich von Hayek in particular has shown - does not prevent potential competition.


There is another, however also widespread type of person: the power seeker, who strives to determine general events and force fellow human beings to behave in a very specific way. It was above all Joseph Alois Schumpeter who pointed out that in a representative democracy the parties also behave in a similar way to entrepreneurs in a market economy; instead of maximising profits, they maximise the votes to be won in the election.


Again, it is not so much the greed for power of the individual politicians that pushes them to such behaviour, but it is again the fact that a politician only has a chance of winning the elections if he holds out the prospect of those measures that guarantee him a maximum gain in votes.


But it is also true for the political subsystem of our society that even a dictator who rules alone is driven by external circumstances to do everything for the expansion of his power. Here too, the greater the position of power already attained, the greater the desire of others to attain this position of power and to overthrow the current ruler through revolution. It is hardly possible for a dictator to rest on the power he has achieved and refrain from securing his power by seeking even more power.


A third type of person strives first and foremost for prestige among his fellow human beings; he wants to be respected, even loved by others. As is well known, the powerful also like to take a 'bath in the crowd'. In contrast to the other two types of people, this desire comes from within, is predominantly psychologically determined. There are also fewer external incentive systems that force such behaviour.


Respect, esteem and love generally only occur when the one who wants to be respected and loved by others has previously approached the other, has made an advance performance, so to speak, and also respects and loves the other.


In this regard, this third type of human being differs from the other two primarily in that there is a reciprocal relationship between people who are connected to each other in mutual respect. The rich man gains his wealth by making the others poorer and the powerful man is powerful to the extent that the respective others are powerless.


Of course, these three types of people are ideal types, which rarely occur in this purity. Most real people mostly have characteristics of all three types, only the mixture ratio is such that the individuals strive either in particular strongly for wealth or for power or finally for recognition.


Even and especially those in power strive within themselves for prestige, and since prestige cannot be forced - at best, one can make others pretend to respect the powerful - their ultimate aspirations are not fulfilled either, and that is precisely why they strive to achieve the never-attainable goal through even more power, or to gain even more power as compensation.


Also, rulers can abuse their power to be corrupt, to accumulate wealth, and to give wealth to their relatives.


A super-rich person also has power, he first has power over his workers who have to obey his directives and he can also buy power in the political system by providing politicians with the material resources without which they can neither defend nor expand their power.


Secretly, he too will crave prestige, the only difficulty is that he is usually so consumed by his economic tasks that he does not have the time to devote to those from whom he expects respect and love, but it is precisely prestige and love that can only be achieved if one devotes oneself intensively to the other, a necessity that naturally also applies to the ruler.


Finally, a few words about the third type of person, for whom respect and affection for people is the most important thing on earth. While both the rich and the powerful only achieve their goals if they influence as many people as possible on a large scale and accumulate wealth, it is true for the third type of person that his desire is mostly directed towards one or only very few individuals, since lovers take full advantage of themselves, they do not need to bathe in the crowd like the powerful, the love and respect that the lover shows him is also enough to make him happy.


Here one will be able to assume that love, especially in the first stage, is carried predominantly by erotic affection and also reaches its climax emotionally in Eros initially.


However, in the course of time, these more external feelings also tend to fade in the course of everyday togetherness. True love and mutual respect can only be achieved by those whose love is not exhausted by this initially quite selfish feeling, but who give the other person at least the same importance as their own ego and are prepared to accept the other person as he or she is and are also prepared to put aside their own preferences for the sake of the other person's well-being.



5th The importance of the past for today's contentment


But even if we disregard the fact that happiness and contentment do not only depend on wealth respectively assume that two similar persons do not differ with regard to the other determinants of happiness and contentment, we still have to conclude that these similar persons are happy or unhappy to a quite different extent even with the same income or wealth.


Now, of course, our judgement is complicated by the fact that there is no objective, generally accepted benchmark to accurately measure contentment or happiness. It was above all Vilfredo Pareto who criticised the older welfare theory and doubted that it was possible to measure units of utility interpersonally. In other words, it is not possible to state whether two comparable persons derive the same amount of utility or a higher or lower amount of utility from a certain income of the same amount.


Utility was of subjective nature; a single individual was indeed able to compare two conditions with each other and recognise whether they experienced the same or different benefit from their income. However, there would be no way to compare the benefit level of two individuals.


Even if there have been and still are a few important economists who, like Jan Tinbergen, have not followed this view and believe that standards for an interpersonal comparison of benefit could very well be developed, the mainstream of economists has followed Vilfredo Pareto on this issue.


Nevertheless, one can hardly deny that in reality such comparisons of benefits between different people are carried out time and again. For example, there is no doubt in the public mind that a billionaire derives more benefit from his income than a person who is dependent on social welfare.


Generally speaking, it can be assumed that upbringing based on the same cultural values has also produced the same or similar behavioural patterns and evaluation standards in the individual people, and that because of this largely identical upbringing, the behavioural patterns that reflect the individual state of mind are also largely the same.


When a mother who has suffered a natural disaster or a terrorist attack pulls out her hair in grief, almost everyone understands this grief, they know that this woman has suffered greatly and they understand this attitude because they would also act in the same way if the same thing had happened to them due to the same or similar upbringing. He also does not have to fear that this woman is only feigning great sorrow, because no conscious attempts at deception have ever been observed in her in the past.


So, if we find that two different subjects, with the same wealth today, are nevertheless content to very different degrees, this could be because their wealth was different in the immediate past.


A fellow citizen who was particularly rich in the past may have lost most of his wealth and is therefore highly discontent with his wealth status today, although he has sufficient wealth left. Another fellow citizen may have owned nothing at all in the past, but has now acquired a small fortune, which - let us assume - is now the same amount as that of the previously rich person. He is nevertheless overjoyed at the unexpected relative wealth.


Even if we admit with Pareto that we cannot precisely determine and compare the degree of contentment interpersonally, most of us are nevertheless convinced that the hitherto poor person is considerably more content than the hitherto rich person, even though both are assumed to have the same amount of wealth today.


And the reason for this different degree of satisfaction in our example is quite clearly that both had different levels of wealth in the past. Thus, we can assume that it is not so much today's absolute wealth, but rather the past development of wealth that is ultimately responsible for how content the individual actually is today.



6th The role of expectations in today's happiness


The real reason why, even with the same level of wealth today, the degree of satisfaction nevertheless differs depending on the wealth or income the individual had in the previous period is that the income of the previous period shapes expectations about today's income and that contentment and happiness depend less on the absolute level of today's income than on the extent to which expectations were fulfilled.


People are generally predisposed to a feeling of happiness when they have been able to realise what they have set out to do, and therefore the degree of contentment also depends on the extent to which expectations have been fulfilled. The smaller the difference between expected and actually realised income, the greater the degree of contentment.


This connection is related to Gossen's law of the decrease in the increase in utility (the so-called marginal utility) with increased consumption of a good or with an increase in income. According to this law, if an individual can only consume very little of a good, he will experience a very high increase in utility, while if he consumes more units of this good, there will still be an increase in utility, but it will become smaller and smaller.


Thus, to someone who is almost dying of thirst, the first glass of water means life-saving and therefore the increase in utility here is also infinitely large; the increase in utility of each further glass of water initially brings further increases in utility, but ever smaller ones, until then, with further consumption of this good, the utility not only becomes zero, but even leads to aversion, i.e. to a negative utility.


Let us make this connection clear with the help of a diagram.


On the abscissa we enter the income level, on the ordinate the marginal utility. We assume that our individual achieved income E0 in the previous period. If he now achieves a lower income E-1 in today's period, the area corresponding to the red arrow corresponds to a significantly higher utility loss due to the law of diminishing marginal utility than if this individual had achieved an income increase to E+1 and thus a utility gain corresponding to the green arrow.


In other words, the same change in income, measured in absolute units, causes a different change in utility depending on whether the expected income increases or decreases. This effect is further strengthened by the fact that the utility experienced in the previous period is known, i.e. it is known exactly, whereas the increases in utility expected from a rising income are not yet known, it is an expected value that is hoped for, but which is more or less uncertain and therefore lower, the amount of which thus cannot be estimated clearly.


If what has been achieved in the past is no longer available today, then this is disappointing because we know from the past that it was achievable, why should it no longer be available in the present period? Conversely, what is additionally achievable in the future period is that one had to get by without it in the past period, so that it would not have an essential, life-threatening effect if one had to get by without this increase in the coming period.


Nevertheless, it is in the nature of human beings to want to achieve more in the coming period than in the past, so that in our society there is quite generally a consciousness of growth. And this growth consciousness causes dissatisfaction with what has been achieved today not only when it is less than in the previous period, but also when the fact that we have not achieved more in the current period than in the previous period is perceived as something negative.


Such a growth attitude is particularly evident on the stock market. Here one has repeatedly noticed that the prices for the shares of individual enterprises have fallen after the publication of the annual balance sheet and the further profit prospects, although this enterprise has achieved high, perhaps even above-average profits, and was sometimes even able to show a clear increase in profits compared to the previous period.


The prices of such an enterprise have nevertheless fallen, because the stock exchange traders had expected an even higher growth in profits. Due to this expectation, they had already anticipated this hoped-for growth and, due to this attitude, the demand for these shares had already risen in the past and with this demand also the prices.


Since the growth in profits turned out to be lower than expected, the initially too positive expectation had to be corrected, shares of this enterprise were sold out of disappointment and this ultimately led to the observed price loss despite rising profits.



7th Frustrations as a result of unfulfilled expectations


Frustrations are the counterpart to expectations. If expectations cannot be fulfilled, disappointment arises, we speak of frustrations, which prevent contentment and happiness from occurring. It can be assumed that frustration increases to the extent that expectations are disappointed, i.e. the gap between the expected and the actually realised objectives increases.


However, these correlations only apply ceteris paribus; it is also true here that the extent of frustrations depends on a multitude of other accompanying circumstances, so that even if two individuals have experienced a comparable extent of distance between expectation and realisation - let us simply assume that such a comparison could also be made - nevertheless both individuals experience very well a different extent of frustration.


Frustrations are psychological conditions that we humans have inherited from our ancestors, who had not yet experienced the civilisation of our society, led a nomadic life and had to wage a permanent struggle for survival. Material resources were extremely scarce, one had to use one's life to acquire the bare necessities. The frustration that always set in when there was a danger of losing this fight now had the function of mobilising human abilities and physical forces in order to still win this fight for survival.


We have now inherited these psychological forms of behaviour from our ancestors, although they are no longer vital for our survival today. Nevertheless, every frustration - if it is not processed - automatically leads to aggression and in this way reinforces behaviour that is directed against other people.


Although this reaction was vital for our ancestors and therefore had a function, these aggressive activities are dysfunctional in our civilised society today. They are largely undesirable today because they are not necessary for the satisfaction of our needs, i.e. because they lead to a fighting behaviour that in most cases even prevents an optimal realisation of individual needs.


If these forms of behaviour are also innate, this does not mean, however, that we are completely commited to them and that they cannot be influenced. On the contrary, it is precisely one of the most important tasks of early education to break this inherited and innate connection.


We have seen that frustrations arise from expectations not being fulfilled. Individual expectations do not come out of nowhere and are not innate. Rather, it is precisely the task of education to ensure that expectations develop realistically.


In this context, realistic means that expectations must always be based on the circumstances; for example, it would not make sense for somewhat poorer parents to give their children the same expectations that particularly rich parents can give their children. It would simply be unrealistic to think that one can rise to the highest peaks from nothing. If poorer parents wanted to give their children the prospect of such goals, the non-fulfilment of these goals and thus frustration would be pre-programmed.


Of course, this does not mean that we should be content with the given. Precisely because individuals in the past have repeatedly pursued goals that were initially considered unachievable for human beings, it has been possible to increase prosperity enormously in the last two centuries, and not just for a few rich citizens, but for the majority of citizens. But here too, if one strives for too much, if the goals are unattainable in real life, the end result can even be that prosperity declines in the future.


One of the most important tasks of early education is that children learn to deal with frustration. Only if one does not try to influence the consequences of a frustration then it is true that every frustration leads to aggression even where it only causes harm to others as well as to oneself. Aggression can very well be redirected (sublimated) through education, so that in any case the damage caused by aggression can be reduced.



8th The role of education


In the following section, let us examine the question of the importance of upbringing for the contentment of individuals. If - as we have shown above - the degree of satisfaction depends decisively on expectations, then it depends decisively on education what goals the individual pursues and what degree of contentment the individual achieves.


A person can be brought up to be content with what is given or to always strive for something higher. Of course, it also depends on the respective hereditary dispositions which aims in life the individual will finally pursue, but only both together - the hereditary dispositions as well as the upbringing - ultimately decide which aims the individual will finally pursue.


Upbringing can now consist in the fact that the adolescent should certainly strive for higher things, but that the individual learns to recognise what is feasible and what is not feasible. And what is feasible or not in an individual case depends on two things: on the external conditions in which the individual is placed during his life, but also on the inherited dispositions.


The individual can only influence the external conditions by working in cooperation with others to change the social order, and this in turn presupposes that the political order allows such influence to be exerted at all. Here, the possibilities for people living in a liberal and democratic order are of course much greater than for people living in a dictatorship.


And of course, it must be recognised that both the individual educator and the society are responsible for the success of education. Often, educational efforts simply fail because the state and society do not provide the framework conditions that are necessary for educational efforts to be successful. But no matter how excellent these framework conditions may be, if the framework set by society is not filled by the individual educators, education still fails.


One of the main tasks of any education is that the adolescent learns to recognise his limitations, on the one hand the limitations that are determined by his genetic constitution, but on the other hand also the limitations imposed by the social order in which the individual lives.


In this context, it is important to recognise that education in this respect can stipulate too much, but also too little. On the one hand, there is the danger that the young person is urged to achieve more than he or she is capable of due to his or her disposition or the external limitations that cannot be changed by the individual. On the other hand, too little is the case if the young person is not given the opportunity to develop according to his or her inherited talents.


Often there is also the danger that parents try to set goals for their children that do not correspond to their children's disposition, but that the parents try to catch up with the goals that they themselves had in their youth but could not achieve for some reason.


Often, the goals that parents try to instil in their children do not primarily serve the well-being of the young people that are to be educated, but solely or primarily the interest and social standing of the parents.


Let us therefore note: The degree of satisfaction achieved by individuals depends decisively on the extent to which educators, together with the social order, succeed in setting goals for young people that correspond to their disposition and inclination.


Education can also increase the level of contentment indirectly by showing how to manage frustration in such a way that neither the adolescent nor the people around that adolescent suffer greater harm.


Without these educational efforts, people tend to work off their frustrations through aggressive behaviour. As already mentioned, we have inherited this behaviour from our ancestors in ancient times and it certainly had its function at that time. The struggle for survival for the few material goods was so strong that survival was only possible by temporarily increasing the efforts of the individual when frustrations arose through an adrenaline surge that manifested itself in aggression.


The achievements of industrialisation brought such an increase in the production of goods that nowadays there is no longer any need for these aggressive behaviours for the survival of the individual, indeed they even make it difficult to lead a regular life. In other words, the aggression triggered by frustrations is dysfunctional today and one of the most important tasks of education is to prevent frustrations as far as possible and, where this is not possible, to develop strategies that reduce frustrations without aggressive behaviour.


It is precisely in this question that education often fails, as many parents and educators see their only task in this question in creating as many frustrations as possible for those to be educated in a more or less artificial way, in the opinion that it is enough that the children are exposed to frustrations at an early age. Thus, they act according to the motto, if you throw a small child into the water, it will surely learn to swim by itself. In the same way, young people would know by themselves how to deal with a frustration.


However, this view is highly questionable for several reasons. First of all, it is true for almost all population groups that individual families are exposed to a multitude of frustrations, so that there is no need for efforts to artificially create new, additional frustrations.


This is also true in our welfare society. We have seen above that together with wealth also our needs grow, so that even today hardly anyone achieves all his goals and would therefore no longer be exposed to frustrations. Even the super-rich experience permanent frustrations; they do not consist of having to suffer from hunger, but they too are exposed to diseases just like the rest of the population and usually have to suffer from much stronger competitive pressure.


The artificial creation of frustrations is especially harmful when the children to be educated get the impression that these frustrations have been artificially created by their educators, i.e. that they are not necessarily given from outside. The children then understand these actions as being directed against themselves and this behaviour of the parents then contributes all the more to these frustrations causing aggression in the children. In addition, children learn in this way that there is an up and a down, that one should strive to belong to those up there and that it is quite normal to crawl to the bigwigs and bully the underlings in the sense of a cyclist.


The task of education in connection with frustrations is therefore not so much to artificially create frustrations - there are enough frustrations as it is - but to acquire the skills to cope with frustrations without harming oneself or others.


There are a variety of strategies for coping with frustration. If you are angry with someone, for example, you can consciously refrain from attacking them verbally or physically. One writes a strong letter in which one expresses one's anger, but does not send this letter.


Or one learns to value the loss of benefits differently by consciously considering the loss of benefits as the price to be paid in order to achieve a higher benefit in the future. Every investment follows this pattern. Today, for example, one initially incurs costs by buying expensive machinery in order to then achieve a multiple of the previous production and thus also a higher profit in the following periods through the use of the machines.


Sporting activity can also help to reduce frustration. Aggression comes about because an adrenaline rush is supposed to enable the person concerned to perform better than before in the fight for survival. The adrenaline rush serves to increase one's performance through one's own efforts; the additional strength is turned against one's own body and even causes additional suffering there. But since this is deliberately brought about and serves to increase the overall success, the dissatisfaction gives way and contentment then prevails.



9th Contentment depending on the wealth of others?


Up to now, we have assumed that contentment depends primarily on circumstances that fall within the sphere of the person whose contentment is under discussion. But doesn't contentment also depend on the wealth of others? The individual is not an isolated being, but rather integrated into a social community. It stands to reason that one's own satisfaction also depends on the wealth that others have achieved.


The first thing to think of here would be the individuals who live in a close social network. The individual is integrated into a family, he has parents who have possibly already achieved a lot and who serve as role models. Whereby it is often the parents themselves who urge their children to achieve as much as possible the same as them or even more than them. In the medieval farm or craftsman's business, this aspiration came naturally, since the children would one day continue and expand their own business.


But comparison among siblings can also contribute to emulating one's siblings and only being content when one has reached a comparable position in adult life.


However, social ties are not limited to blood relations, but rather refer to further social contacts which are established during youth in the neighbourhood, later in schools, in clubs and finally in the enterprise in which the individual is employed and on whose professional success one's own success is also measured and thus ultimately the contentment of the individual depends.


We live in a performance society in which almost everyone is in competition with others and it is precisely by achieving something more than one' s peers that one can prove oneself.


However, it is not only the idea of competition that makes one's own contentment dependent on the success and wealth of others. The idea of equality is also often used to explain a high levelling of income and wealth as the goal of distribution.


In this context, it is mostly conceded that individual performance should certainly be considered in the distribution of income, but that the differences in performance could only explain a small differentiation. And thus, a decrease in the differentiation of incomes is demanded and this then in turn leads to the individual measuring his contentment by how far he has succeeded in climbing up the hierarchy of income.


Critically, however, it must be noted that although the idea of justice is always determined by the demand for equality, the demand is only made to treat the same things equally. De facto, it can be assumed that individual people even differ to a great extent in terms of both performance and willingness to perform. The demand for absolute equality would therefore contradict precisely this human disposition and in this way even prevent the human happiness of individuals.


It is also wrong to measure the performance of the individual on the basis of the physical performance of the individual and thus the resulting work suffering. The extent to which the individual has brought welfare to the community does not depend primarily on the mental efforts of the individual worker, but solely on the benefit that others derive from this work. A worker may have done as much physical and mental work as possible, but if the product of his work is of no use to anyone, the benefit to the public is still zero.


The extent of the general welfare therefore does not depend in any way on how much labour suffering the worker has performed. An inventor may have arrived at his invention purely by chance, i.e. he may not have experienced any labour suffering at all, and yet have decisively increased the welfare of the general public.


Behind the idea that one can increase the happiness of people by levelling incomes and wealth stands the further hypothesis that any less for the rich automatically leads to a largely equal more for the poor. However, this hypothesis is wrong for several reasons.


First of all, it must be considered that every redistribution leads to administrative costs and that therefore only the remaining part of the tax revenues can be passed on to the poorer. A civil service apparatus must be created that both collects the taxes and pays out the transfer income.


Since the richer are placed in a worse position, it can always be expected that a part of the richer will try to avoid the additional taxation. Conversely, the additional transfer incomes of the poorer people lead to attempts by some of them to influence the conditions for receiving these transfer incomes in their favour. The state must therefore introduce controls that increase the administrative costs associated with each redistribution by another and reduce the residual amount that is to be distributed.


Furthermore, any redistribution in favour of the recipients of lower incomes has negative growth effects. The ability to save depends crucially on the level of individual incomes; the richer can automatically save more than the poorer, with the consequence that with growing levelling, less is saved for the economy as a whole and thus less capital is available for investment. However, if the total amount of investment in the economy decreases, the growth rate also decreases.


And this in turn has further consequences for income distribution. Even if the income of wage earners is higher in the current period due to levelling than it would be without redistribution, it must still be assumed that wage incomes will also rise less due to the lower growth rate and that a point will therefore be reached in the future from which on absolute incomes will be lower than without redistribution.



Moreover, it applies that due to the progression of income tax, tax revenues decrease in the case of levelling, and that therefore less money is available for social aid, so that too much levelling leads so to speak to sawing off the branch on which one is sitting.


After all, renewals and the increases in productivity that they trigger are always associated with a high risk for those who provide the capital. In the case of a strong levelling, the willingness to provide risk capital decreases, since higher risks can only be taken if one also has larger sums of assets at one's disposal.


The rich can divide his assets among different projects. For him as well, it applies that loss-making capital investments must always be expected. However, since the rich person can distribute his capital over several investments, he can also expect that in addition to loss-making investments, there will also be particularly profitable investments. On the other hand, those who only have a small amount of assets and therefore have to limit their entire capital to a single investment will lose their entire assets in the case of a loss-making investment.


It is first and foremost inherited values that determine how important the wealth of others is for one's own happiness and not natural, inherited dispositions that automatically make an individual unhappy if others have achieved more wealth than oneself.


Three different value systems can be identified here. A liberal world view educates one to achieve as much as possible and the everyday pressure of competition automatically leads one to want to achieve more or at least as much as one's reference persons, whereby reference persons are mainly those individuals with whom one has direct contact, i.e. parents or siblings, acquaintances from the neighbourhood or in the club, finally work colleagues among employees or the respective competitors of the self-employed.


We encounter a completely different value system in socialism. From a purely external point of view, also here the individual is educated to compare himself with others. Here, however, it is not so much the individuals who have personal contacts, but rather the principle of equality, that all people are the same and should therefore have roughly the same wealth, whereby it is admitted that a higher performance also justifies a higher income, but the performance is measured in terms of work suffering and that this shows only slight differences.


Such a world view leads automatically to the fact that a high differentiation in income and wealth is considered undesirable and therefore also triggers discontent among those who are at the bottom of the income hierarchy.


The religious worldview of Christianity classifies wealth quite differently. The tenth commandment forbids envy, that is, desire the wealth of others. Wealth fulfils a completely different function here. It is assumed that people do indeed differ both in terms of talent and wealth, but that these differences are also justified, since wealth is not primarily used to serve one's own satisfaction, but to work for the community, i.e. in a serving way.


The fact that the individual may nevertheless use his wealth to a limited extent for the satisfaction of his own needs is then connected to the fact that the impulse to act successfully is greater when the individual also participates in the increase in welfare that he has brought about. But it is always true that ownership obliges.


If, however, the wealth of the rich is predominantly used to realise the overall economic welfare, the wealth of the rich is no longer a nuisance and therefore does not reduce the contentment of those who have a lower income. One's own contentment then depends predominantly on one's own characteristics.