If we assume that the individual’s self-assessment of wealth does not necessarily depend on the size of his or her bank balance but on a self-assessment of health, security and happiness such that, when maximised, disincentivises any aspirations for social advancement, then wealth can become measurable and thus meaningful for everyone and not just those whom a journalist, say, would describe as wealthy — that is, excluding most in a population.
If the package of health, security and happiness is accepted as a collective synonym for the cognitive feeling of wealth that people have in their brains then any number of people in a population can be as wealthy as the singleton in the present era who is the richest person in the population in terms of cash according to the present definition of personal wealth — and also who is number one in social rank order according to modern culture.
Total poverty is that condition when an individual is able to eat just enough food to survive, but not a gram more. More exactly this is a condition when the energy gained from food is the same as for the energy required by normal bodily functions. If the amount of food eaten is more than the minimum due to the relative ability of the individual compared with others then wealth is gained.
Total maximum wealth is that condition when an individual has enough abilities to be able to eat more food as is needed to maximise all those body processes which lead to the brain having the experience of feeling that health, security and happiness cannot be improved any further.
The absolute definition of wealth now becomes modified with relative notions of personal ability. But this doesn’t justify that relative wealth should now take over as the only definition. The absolute definition of wealth is the more fundamental one.
Of the three components of cognitive wealth — health, security and happiness — it is only the last term that is labile enough to be useful when measured on a daily basis. Marking each one out of ten which one’s brain can readily do — crude but still scientific enough — the first two might remain much the same for weeks, months or even years on end, but happiness changes daily — and within the day. Also. happiness can be usefully compared between one age group and another.
Happiness can also be usefully compared between one nationality and another because measurements can yield correlations with other aspects of their culture, such as relative forms of governance — which are conducive to average happiness and which are not.
At the personal level, some economists who study happiness such as Richard Easterlin and Andrew Oswald have revealed that happiness rises with social rank order. If someone i given a promotion or an entrepreneur rises up the wealth scale by unusual personal effort then personal happiness invariably increases.
The subjective gain might seem to have disappeared within a few days or weeks but not if an individual is demoted to his previous level or an entrepreneur loses his recent gains. The stresses that then result — and they can be considerable — show that the previous gain really did mean something. This is probably due to an altered state of an individual’s brain — in the expectation of social deference from lower social levels — once a gain had been made.
Richard Easterlin and Andrew Oswald have also shown that a law of diminishing returns applies to the gains in happiness. On average, most people’s happiness stabilises when reaching a salary of around £40,000 ($50,000) per annum. Note that this is the minimum income required in order to buy the basic package of status goods — house, car, furniture, clothes, personal ornaments, etc. For the average person, no more income is needed because there have been no more status goods in the offing since the 1980s.