Rather than increased competition, I think the reason we are not happier is that wealth levels have risen for all classes[1]. Materially we are better off than our ancestors but relatively speaking we are the same.<p>Most people would prefer to have higher status than higher wealth. For details, I recommend the excellent book "Choosing the Right Pond: Human Behavior and the Quest for Status" by economist Robert H. Frank. <a href="http://www.amazon.com/Choosing-Right-Pond-Behavior-Status/dp/0195049454" rel="nofollow">http://www.amazon.com/Choosing-Right-Pond-Behavior-Status/dp...</a><p>[1] There is no question that we are all materially better off than previous generations. However considering the 30 years of stagnating middle class incomes, whether this will be true in the future is up for debate. If the middle class  starts declining relative to the super-rich expect major unhappiness.