The Connection Between Self Esteem And Income

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It is often speculated upon whether there is any relationship between the amount of money a person has and their level of happiness. Whilst many researchers have directly investigated such a link, most have found little-to-no correlation (Quoidbach, Dunn, Petrides & Mikolajczak, 2010; Devoe & Pfeffer, 2009). However, a less discussed relationship is that between a person’s self-esteem and their income levels. As it has been found that self-esteem is strongly linked to a person’s happiness (Baumeister, Campbell, Krueger & Vohs, 2003; Swann, Chang-Schneider & Larsen McClarty, 2007), this paper aims to investigate the connection between self-esteem and income, in order to better understand the link between money and happiness.
Mandara and Murray (2000) defined self-esteem as the favourable or unflattering views a person has of his or her own attributes. There are several theories that explain how a person’s level of self-esteem is determined, however the one that will be of focus in this essay is known as the ‘Self-Discrepancy Theory’ (Higgins, 1987). After explaining the intricacies of this theory, it will be linked into the various findings about the connection between self-esteem and income from multiple sources.
First termed in 1987 by Higgins, the Self-Discrepancy Theory describes how different sorts of disparities between self-state representations can be connected to various emotional vulnerabilities. Higgins (1987) suggested that there were three domains of the self.

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