The “Happy and Poor” Paradox: Why Do Some Poor People Report Being Very Happy?

Abstract This review explores the apparent paradox of people experiencing poverty while reporting high levels of happiness, a phenomenon that challenges conventional economic assumptions. We aim to answer the following questions: (1) What are the characteristics and key findings of previous literature on the “happy and poor” phenomenon?; and (2) What are the main explanations for its occurrence? To that end, we follow the PRISMA guidelines to synthesize findings from 40 studies, covering a range of geographic and socio-economic contexts. Based on a detailed analysis of the selected papers, we provide the following answers to the research questions raised. (1) Evidence of happy and poor populations comes mainly from the Global South. Existing studies are largely empirical and use an array of happiness and poverty measures. (2) We identify six different explanations for the situation: (a) the happy and poor are still able to meet their human needs and achieve satisfaction in important domains of life, (b) they adapt to their hardship, (c) they do not have strong aspirations, (d) scientists and policymakers misjudge their well-being, (e) the happy and poor enjoy cultural institutions that foster their happiness, and (f) the process of (mal)development has not eroded their cultural institutions.