Can money really buy happiness?

A big question asked by Allen Sanderson in the Chicago Life magazine. The basic message in his argument is  in the last paragraph:

In the end, GDP and average income may still be the best measures of well-being, in part because they correlate so strongly with other quality-of-life variables such as access to basic necessities, better health, and education. And despite their flaws, they are a pretty good ‘North Star’ to follow. Of course, some people watch Dr. Phil, try to keep up with the Kardashians, are avid fantasy sports league participants, or send 100 text messages a day, exhibiting that even in the midst of plenty you can still have no life.

GDP is not a measure of welfare, it was not designed to be one. But is does have a positive correlation with things that we think do improve welfare, so as a first cut, real GDP per capita is not a bad place to look to get a handle on welfare of a country.