Skip to main content
    • Aa
    • Aa
  • Get access
    Check if you have access via personal or institutional login
  • Cited by 6
  • Cited by
    This article has been cited by the following publications. This list is generated based on data provided by CrossRef.

    Sekulova, Filka and van den Bergh, Jeroen C.J.M. 2016. Floods and happiness: Empirical evidence from Bulgaria. Ecological Economics, Vol. 126, p. 51.

    Osafo Hounkpatin, Hilda Wood, Alex M. Brown, Gordon D. A. and Dunn, Graham 2015. Why does Income Relate to Depressive Symptoms? Testing the Income Rank Hypothesis Longitudinally. Social Indicators Research, Vol. 124, Issue. 2, p. 637.

    Boyce, Christopher J. Wood, Alex M. and Powdthavee, Nattavudh 2013. Is Personality Fixed? Personality Changes as Much as “Variable” Economic Factors and More Strongly Predicts Changes to Life Satisfaction. Social Indicators Research, Vol. 111, Issue. 1, p. 287.

    Guzman, Jaime Ibrahimova, Aybaniz Tompa, Emile Koehoorn, Mieke and Alamgir, Hasanat 2013. Nonwage Losses Associated With Occupational Injury Among Health Care Workers. Journal of Occupational and Environmental Medicine, Vol. 55, Issue. 8, p. 910.

    Wood, Alex M. Boyce, Christopher J. Moore, Simon C. and Brown, Gordon D.A. 2012. An evolutionary based social rank explanation of why low income predicts mental distress: A 17 year cohort study of 30,000 people. Journal of Affective Disorders, Vol. 136, Issue. 3, p. 882.

    Boyce, Christopher J. and Wood, Alex M. 2011. Personality and the marginal utility of income: Personality interacts with increases in household income to determine life satisfaction. Journal of Economic Behavior & Organization, Vol. 78, Issue. 1-2, p. 183.


Money or mental health: the cost of alleviating psychological distress with monetary compensation versus psychological therapy

  • Christopher J. Boyce (a1) and Alex M. Wood (a2)
  • DOI:
  • Published online: 01 October 2010
<span class='bold'>Abstract</span>

Money is the default way in which intangible losses, such as pain and suffering, are currently valued and compensated in law courts. Economists have suggested that subjective well-being regressions can be used to guide compensation payouts for psychological distress following traumatic life events. We bring together studies from law, economic, psychology and medical journals to show that alleviating psychological distress through psychological therapy could be at least 32 times more cost effective than financial compensation. This result is not only important for law courts but has important implications for public health. Mental health is deteriorating across the world – improvements to mental health care might be a more efficient way to increase the health and happiness of our nations than pure income growth.

Corresponding author
*Correspondence to: Christopher J. Boyce, Department of Psychology, University of Warwick, Coventry CV4 7AL, UK. Email:
Linked references
Hide All

This list contains references from the content that can be linked to their source. For a full set of references and notes please see the PDF or HTML where available.

D. G. Blanchflower A. J. Oswald (2004), ‘Well-being over time in Britain and the USA’, Journal of Public Economics, 88(7–8): 13591386.

P. Bower , S. Byford , B. Sibbald , E. Ward , M. King , R. Lloyd M. Gabbay (2000), ‘Randomized controlled trial of non-directive counselling, cognitive-behaviour therapy, and usual general practitioner care for patients with depression. II: Cost effectiveness’, British Medical Journal, 321(7273): 13891392.

P. Brickman , D. Coates R. Janoffbulman (1978), ‘Lottery winners and accident victims – is happiness relative?’, Journal of Personality and Social Psychology, 36(8): 917927.

A. E. Clark , E. Diener , Y. Georgellis R. E. Lucas (2008), ‘Lags and leads in life satisfaction: a test of the baseline hypothesis’, Economic Journal, 118(529): F222F243.

A. E. Clark A. J. Oswald (2002), ‘A simple statistical method for measuring how life events affect happiness’, International Journal of Epidemiology, 31(6): 11391144.

W. Darity A. H. Goldsmith (1996), ‘Social psychology, unemployment and macroeconomics’, Journal of Economic Perspectives, 10(1): 121140.

R. A. Easterlin (1995), ‘Will raising the incomes of all increases the happiness of all?’, Journal of Economic Behavior & Organization, 27(1): 3547.

A. Ferrer-i-Carbonell B. M. S. van Praag (2002), ‘The subjective costs of health losses due to chronic diseases. An alternative model for monetary appraisal’, Health Economics,, 11(8): 709722.

J. Gardner A. J. Oswald (2007), ‘Money and mental wellbeing: a longitudinal study of medium-sized lottery wins’, Journal of Health Economics, 26(1): 4960.

R. Layard (2006), ‘Health policy – the case for psychological treatment centres’, British Medical Journal, 332(7548): 10301032.

C. M. Michaud , C. J. L. Murray B. R. Bloom (2001), ‘Burden of disease: Implications for future research’, JAMA-Journal of the American Medical Association, 285(5): 535539.

S. Moore J. P. Shepherd (2006), ‘The cost of fear: shadow pricing the intangible costs of crime’, Applied Economics, 38(3): 293300.

A. J. Oswald N. Powdthavee (2008a), ‘Death, happiness, and the calculation of compensatory damages’, Journal of Legal Studies, 37: S217S251.

A. J. Oswald N. Powdthavee (2008b), ‘Does happiness adapt? A longitudinal study of disability with implications for economists and judges’, Journal of Public Economics, 92(5–6): 10611077.

N. Powdthavee (2008), ‘Putting a price tag on friends, relatives, and neighbours: using surveys of life satisfaction to value social relationships’, Journal of Socio-Economics, 37: 14591480.

B. M. S. Van Praag B. E. Baarsma (2005), ‘Using happiness surveys to value intangibles: the case of airport noise’, Economic Journal, 115(500): 224246.

E. Ward , M. King , M. Lloyd , P. Bower , B. Sibbald , S. Farrelly , M. Gabbay , N. Tarrier J. Addington-Hall (2000), ‘Randomized controlled trial of non-directive counselling, cognitive-behaviour therapy, and usual general practitioner care for patients with depression. I: Clinical effectiveness’, British Medical Journal, 321(7273): 13831388.

Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

Health Economics, Policy and Law
  • ISSN:
  • EISSN:
  • URL: /core/journals/health-economics-policy-and-law
Please enter your name
Please enter a valid email address
Who would you like to send this to? *