New Economics Papers
on Economics of Happiness
Issue of 2007‒12‒15
six papers chosen by

  1. Lags and Leads in Life Satisfaction: A Test of the Baseline Hypothesis By Andrew E. Clark; Yannis Georgellis; Richard E. Lucas
  2. Is Well-being U-Shaped over the Life Cycle? By Blanchflower, David G.; Oswald, Andrew J.
  3. Death, Happiness, and the Calculation of Compensatory Damages By Oswald, Andrew J.; Powdthavee, Nattavudh
  4. Hypertension and Happiness across Nations By Blanchflower, David G.; Oswald, Andrew J.
  5. Human Development- Conceptual and Measurement Issues By Nayak, Purusottam
  6. Inter District Disparities in Meghalaya: A Human Development Approach By Nayak, Purusottam; Ray, Santanu

  1. By: Andrew E. Clark; Yannis Georgellis; Richard E. Lucas
    Abstract: We look for evidence of habituation in twenty waves of German panel data: do individuals, after lifeand labour market events, tend to return to some baseline level of well-being? Although the strongestlife satisfaction effect is often at the time of the event, we find significant lag and lead effects. Wecannot reject the hypothesis of complete adaptation to marriage, divorce, widowhood, birth of child,and layoff. However, there is little evidence of adaptation to unemployment. Men are somewhat moreaffected by labour market events (unemployment and layoffs) than are women, but in general thepatterns of anticipation and adaptation are remarkably similar by sex.
    Keywords: life satisfaction, anticipation, adaptation, baseline satisfaction, labour market and lifeevents
    JEL: I31 J12 J13 J63 J64
    Date: 2007–11
  2. By: Blanchflower, David G. (Dartmouth College, USA, University of Stirling, NBER, IZA, CESifo and Member, Monetary Policy Committee Bank of England); Oswald, Andrew J. (Department of Economics, University of Warwick UK)
    Abstract: We present evidence that psychological well-being is U-shaped through life. A difficulty with research on this issue is that there are likely to be omitted cohort effects (earlier generations may have been born in, say, particularly good or bad times). First, using data on 500,000 randomly sampled Americans and West Europeans, the paper designs a test that can control for cohort effects. Holding other factors constant, we show that a typical individual’s happiness reaches its minimum -- on both sides of the Atlantic and for both males and females -- in middle age. Second, evidence is provided for the existence of a similar U-shape through the life-course in East European, Latin American and Asian nations. Third, a U-shape in age is found in separate well-being regression equations in 72 developed and developing nations. Fourth, using measures that are closer to psychiatric scores, we document a comparable well-being curve across the life cycle in two other data sets : (i) in GHQ-N6 mental health levels among a sample of 16,000 Europeans, and (ii) in reported depression and anxiety levels among 1 million U.K. citizens. Fifth, we discuss some apparent exceptions, particularly in developing nations, to the U-shape. Sixth, we note that American male birth-cohorts seem to have become progressively less content with their lives. Our paper’s results are based on regression equations in which other influences, such as demographic variables and income, are held constant.
    Keywords: Happiness ; aging ; well-being ; GHQ ; cohorts ; mental-health ; depression ; life-course
    JEL: D1 I3
    Date: 2007
  3. By: Oswald, Andrew J. (Department of Economics, University of Warwick); Powdthavee, Nattavudh (Institute of Education, University of London)
    Abstract: This paper studies the mental distress caused by bereavement. The largest emotional losses are from the death of a spouse; the second-worst in severity are the losses from the death of a child; the third-worst is the death of a parent. The paper explores how happiness regression equations might be used in tort cases to calculate compensatory damages for emotional harm and pain-and-suffering. We examine alternative well-being variables, discuss adaptation, consider the possibility that bereavement affects someone’s marginal utility of income, and suggest a procedure for correcting for the endogeneity of income. Although the paper’s contribution is methodological, and further research is needed, some illustrative compensation amounts are discussed
    Date: 2007
  4. By: Blanchflower, David G. (Dartmouth College, USA, University of Stirling, NBER, IZA, CESifo and Member, Monetary Policy Committee Bank of England); Oswald, Andrew J. (Department of Economics, University of Warwick UK)
    Abstract: In surveys of well-being, countries such as Denmark and the Netherlands emerge as particularly happy while nations like Germany and Italy report lower levels of happiness. But are these kinds of findings credible? This paper provides some evidence that the answer is yes. Using data on 16 countries, it shows that happier nations report systematically lower levels of hypertension. As well as potentially validating the differences in measured happiness across nations, this suggests that blood-pressure readings might be valuable as part of a national well-being index. A new ranking of European nations’ GHQ N6 mental-health scores is also given.
    Keywords: Health ; hypertension ; Gross National Happiness ; GNH index ; GWB index ; ghq ; blood pressure ; national well-being index.
    JEL: I1 I3
    Date: 2007
  5. By: Nayak, Purusottam
    Abstract: The human development approach to development and growth as proposed by UNDP in 1990 is a widely accepted approach all over world. This paper in this connection is an attempt to describe in details about evolution of the concept of human development, its emergence as an approach to development and the methodological issues on its measurement. It provides an account of various changes in the methods of measurement brought out by UNDP, the Planning Commission, Government of India and the individual researchers at different points of time since1990.
    Keywords: Human Development; HDI
    JEL: O15
    Date: 2007–12–13
  6. By: Nayak, Purusottam; Ray, Santanu
    Abstract: The present paper is an attempt to highlight the magnitude and the problems of unbalanced human development in the state of Meghalaya using data collected for a Major Research Project of UGC. The study reveals widespread variations in human development across all the seven districts and disparities between rural and urban areas and between male and female groups of population within the state. There exists a significant level of disparity both in income consumption and in non-income attainments over the districts. The inequality in economic attainment happens to be very high. However, both measures of variation and inequality index suggest that few non-income indicators such as intensity of formal education and infant mortality rate have disparities over economic indicators which are indeed a cause of considerable concern. In addition, economic inequality is much higher than the overall HDI inequality. With an evidence of a huge shortfall in HDI the existing level of variation and disabilities calls for a need to redesign the public policies that directly affect the welfare of the people.
    Keywords: Disparities; Human Development; HDI
    JEL: O15 O12
    Date: 2007–12–13

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.