Increasing wealth (especially past the point where all your basic needs are met) doesn't make people nearly as happy as they would have predicted.
A few years ago, I read a pretty good book by Harvard social psychologist Dan Gilbert. It's titled Stumbling on Happiness, and it's mostly about the gap between what people think will make them happy and what actually does. It turns out that we aren't very good at all at predicting what will bring us happiness. This has implications for the environment, especially when it comes to why so many people fall into a pattern of over-consumption that leaves them not much happier (and often worse, if it leads to chronic debt and a cluttered life).
There's one concept in psychology that is particularly applicable to consumerism culture. It's called the Hedonic Treadmill. Wikipedia describes it thus:
The hedonic treadmill is the tendency of a person to remain at a relatively stable level of happiness despite changes in fortune or the achievement of major goals. As a person makes more money, expectations and desires rise in tandem, which results in no permanent gain in happiness.
This doesn't mean that being poor is fun, or that becoming richer doesn't make anyone happier in the long-term. But in general, on average, increasing wealth (especially past the point where all your basic needs are met) doesn't make people nearly as happy as they would have predicted, and this goes back to our flawed prediction mechanism.
More money can make you happier if you use it to do the things that really make you happier. For example, for some people it can be to live a life that is more closely aligned with their values, or to have the freedom to spend more times with loved ones, or to reduce the number of sources of stress around them, to support artistic or scientific pursuits, etc.
Stuff, Stuff, Stuff, Stuff, Stuff
But many people spend it all on stuff, lots of stuff. They buy something and get a little happiness hit, but that fades quickly and they revert back to their happiness set point. So they buy something else to get another hit, and something else, and so on until they accumulate a bunch of stuff they don't need, and then they need a bigger house to store it all, and this means more expenses, a higher environmental footprint, and no more financial freedom than before because they have to keep working hard to pay for all that new stuff. They turn into a Fight Club cliché and the stuff they own owns them.
Getting Off the Treadmill
Society-wide, it's not a problem that can easily be fixed. During our ancestral past, physical possessions were so rare that it's probably an evolutionary adaptation to try to acquire as much of it as possible, and the way our brain gets us to do it is by telling us that it will make us happy.
But I think that if people were made more aware of this cognitive bias, that they could mitigate it. Our instinct might be to think that a shiny new toy will make us happy, but if we know that it rarely works that way, we could consciously try to do more of the things that truly make us happy instead (even if they aren't always the things we would have predicted).