By OLINKA KOSTER

Last updated at 12:35 11 June 2007

It is one of the most

pondered questions of all time -

can money buy happiness?

The answer, according to a

study, is yes - but so can

friendships and successful

relationships.

Researchers have been trying to

calculate what effect our finances

and lifestyle have on our emotions.

Their main source was a survey of

10,000 Britons, who were asked to

rate their level of happiness and

answer questions on their wealth,

health and social relations.

The team, from the University of

London, then placed all these

people on a "life satisfaction scale" of

one (utterly miserable) to seven (euphoric).

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Using the information they had

collated, they could calculate how

much extra money the average

person would have to earn every

year to move up from one point on

the scale to another.

They also

worked out how far life events and

changing social relationships on

their own could move someone up

the satisfaction scale.

By comparing these two types of

information, they were able to put

a "price" on social and lifestyle

factors. So, for example, they found

that having excellent health was

worth the equivalent of a £304,000-a-year pay rise in how happy it

made you feel.

Marriage increases happiness

levels by the same amount as earning

an extra £54,000 a year, although,

surprisingly, living together was

worth more, at an extra £82,500.

Meanwhile, chatting to your

neighbours on a regular basis would

make you as happy as getting a

£40,000-a-year pay boost.

The scale also works in reverse,

however, so that the grief of

becoming widowed decreases your satisfaction-with life by the same

amount as your salary dropping

£200,000 a year.

Dr Nattavudh Powdthavee, one

of the main researchers, said: "One

of the things we wanted to find out

was the answer to the age-old

question - can money buy the

greatest amount of happiness

for us?"

What they found, he explained,

was that the results showed the

importance of social relationships.

"One potential explanation is that

social activities tend to require our

attention while they are being

experienced, so that the joy

derived from them lasts longer in

our memory," he said.

"Income, on the other hand, is

mostly in the background.

"We don’t normally have to pay so

much attention to the fact that

we’ll be getting a pay packet at the

end of the week or month, so the

joy derived from income doesn’t

last as long."