The 20-year study led by Brunel University researchers found that traumatic events, such as widowhood or divorce, did make people depressed but they soon recovered from the life's dark phase.
The study also found that the joy people experienced after getting married or having kids, also fade out after a few years.
It was found that the life satisfaction of having a child disappeared after they reached their second birthday
The researchers dubbed the concept as 'thermostat' of happiness- when a big event happens to you, whether it is positive or negative, the spring stretches, but returns back to its former state quite quickly.
"It's consistent with other findings that people recover from negative events very quickly - there was some literature on people who became paraplegic, who, when interviewed a few years later, had similar levels of happiness to those who had not been affected this way," BBC quoted Dr Yannis Georgellis, co-author and senior lecturer in economics at Brunel University, as saying.
"Likewise, there are studies of lottery winners who are no happier in the long term," he added.
The study suggested that people get used to "life-changing" events fairly quickly
"The findings will be interesting for economists and psychologists worldwide as it reveals new mechanisms to explain what makes us happy he told Telegraph.
The study is published in the latest issue of the Economic Journal.