New Economics Papers
on Economics of Happiness
Issue of 2010‒01‒23
seven papers chosen by

  1. Obesity and Happiness By Marina-Selini Katsaiti
  2. Determinants of Health Disparities in Italian Regions By Luisa Franzini; Margherita Giannoni
  3. Urbanization and the Poverty Level By Jorge Martinez-Vazquez; Andrey Timofeev
  4. Self-delusion in the pursuit of happiness By Dag Einar Sommervoll
  5. Citizen-centric governance indicators : measuring and monitoring governance by listening to the people and not the interest groups By Ivanyna, Maksym; Shah, Anwar
  6. HEALTHY HUMAN DEVELOPMENT INDICES By Merwan Engineer; Nilanjana Roy; Sari Fink
  7. On the genesis of Hedonic Adaptation By Perez Truglia, Ricardo Nicolas

  1. By: Marina-Selini Katsaiti (University of Connecticut and University of Athens)
    Abstract: This paper provides insight on the relationship between obesity and happiness. Using the latest available cross sectional data from Germany (GSOEP 2006), UK (BHPS 2005), and Australia (HILDA 2007). We examine whether there is evidence on the impact of overweight on subjective well being. The Hausman test is employed in the univariate and multivariate specifications chosen and reveals evidence for the presence of endogeneity in the German and the Australian data. Instrumental variable analysis is performed under the presence of endogeneity whereas for the UK we run OLS regressions. Results indicate that in all three countries obesity has a negative and significant effect on the subjective well being of individuals. For Germany, using a differences-in-differences methodology, I find that non-overweight/non-obese individuals are on average 0.5 units happier than their overweight/obese counterparts. My findings also have important implications for the effect of other socio-demographic, economic and individual characteristics on well being.
    Keywords: Happiness, Obesity, Instrumental Variable Analysis, Subjective Well Being
    JEL: D60 I31
    Date: 2009–10
  2. By: Luisa Franzini; Margherita Giannoni
    Abstract: There is an extensive literature on regional disparities in health, but much of thisliterature focuses on the United States. Among European countries, Italy is the country whereregional health disparities contribute the most to socioeconomic health disparities. In this paper,we report on regional differences in self-reported poor health and explore possible determinantsat the individual and regional levels in Italy. We use data from the “Indagine Multiscopo sulle Famiglie”, a survey of aspects ofeveryday life in the Italian population, to estimate multilevel logistic regressions that model poorself-reported health as a function of individual and regional socioeconomic factors. Next we usethe causal step approach to test if living conditions, healthcare characteristics, social isolation,2and health behaviors at the regional level mediate the relationship between regionalsocioeconomic factors and self-rated health. We find that residents living in regions with more poverty, more unemployment, andmore income inequality are more likely to report poor health and that poor living conditions andprivate share of healthcare expenditures at the regional level are determinants of socioeconomicdisparities in self-rated health among Italian regions. The implications are that regional contexts matter and that regional policies in Italyhave the potential to reduce health disparities by implementing interventions aimed at improvingliving conditions and access to quality healthcare.
    Keywords: health inequality, Italy, self-reported health, regional health disparities
    JEL: I10 I12 D10
    Date: 2009–10–20
  3. By: Jorge Martinez-Vazquez (International Studies Program. Andrew Young School of Policy Studies, Georgia State University); Andrey Timofeev (International Studies Program. Andrew Young School of Policy Studies, Georgia State University)
    Abstract: This paper analyzes the effect of urbanization on the poverty level. Our theoretical model suggests a U-shape relationship between the level of urbanization and poverty. Urbanization contributes to poverty reduction but at much higher levels, urbanization leads to increases in poverty. Empirically, we estimate the “optimal level” of urbanization by using: (i) an instrumental variable approach in the framework of the generalized method of moments and (ii) a dynamic panel analysis approach. We also investigate the robustness of the impact of urbanization on the poverty level by examining a variety of linkages. The empirical analysis covers different regions of the world to study whether the magnitude of the urbanization effects varies across regions. Our results support the hypothesis that there exists a U-shape relationship between the level of urbanization and the poverty level.
    Keywords: urbanization, public infrastructure, poverty reduction, pro-poor growth
    Date: 2009–12–01
  4. By: Dag Einar Sommervoll (Statistics Norway)
    Abstract: The paper explores how repeated revisions of consumption plans increase long-run utility. If agents value present anticipations of future consumption, some revisions may be viewed as a benign form of self-delusion. We consider a minimal generalization of the Samuelson discounted utility model to allow for utility linked to next period consumption. Agents are assumed to vary with respect to their sophistication. Different environments likely to facilitate repeated revisions are also considered.
    Keywords: Intertemporalchoice;selfdelusion;timeinconsistency;naivete;self-con trol;discountedutilityfunctions;anticipation;memory
    JEL: A12 B49 C70 D11 D60 D74 D91 E21
    Date: 2010–01
  5. By: Ivanyna, Maksym; Shah, Anwar
    Abstract: Governance indicators are now widely used as tools for conducting development dialogue, allocating external assistance, and influencing foreign direct investment. This paper argues that available governance indicators are not suitable for these purposes as they do not conceptualize governance and fail to capture how citizens perceive the governance environment and outcomes in their countries. The paper attempts to fill this void by conceptualizing governance and implementing a uniform and consistent framework for measuring governance quality across countries and over time based on citizens'evaluations. Using data from the World Values Survey (and other sources) we implement this framework into practice and build citizen-centric governance indicators for 120 countries over the period 1994 to 2005.
    Keywords: Governance Indicators,National Governance,Public Sector Corruption&Anticorruption Measures,Banks&Banking Reform,Economic Policy, Institutions and Governance
    Date: 2010–01–01
  6. By: Merwan Engineer (Department of Economics, University of Victoria); Nilanjana Roy (Department of Economics, University of Victoria); Sari Fink
    Abstract: In the Human Development Index (HDI), life expectancy is the only indicator used in modeling the dimension ‘a long and healthy life’. Whereas life expectancy is a direct measure of quantity of life, it is only an indirect measure of healthy years lived. In this paper we attempt to remedy this omission by introducing into the HDI the morbidity indicator, “expected lost healthy years” (LHE), used in the World Health Report Though LHE is only weakly correlated with life expectancy and displays considerable variation across countries, the ranking of nations using the adjusted HDI is very similar to that from the HDI. Nevertheless, there are some outlier countries (including large countries like China and the United States) that experience notable changes in rank. Given the considerable variation in the morbidity data across gender, we also adjust the Gender-related Development Index (GDI) in a similar fashion. The ranking using the adjusted GDI is very similar to that from the GDI, but it has a lower rank correlation with the HDI.
    Keywords: Human Development Index, Healthy Life Expectancy, Morbidity, Gender-related Development Index
    JEL: I00 I1 O5
    Date: 2010–01–08
  7. By: Perez Truglia, Ricardo Nicolas
    Abstract: Some sensations, in addition to guide behavior, serve an extra and even more important role: as warning or defense mechanisms (e.g. pain, fever). Additionally, intense sensations are costly from a fitness point of view. With only these two biological facts we show that Nature must design utility functions with regulation mechanisms such as hedonic adaptation or expectation-based preferences. Even though they are rarely incorporated into economic models, such mechanisms are widely recognized and documented in many fields such as neuroscience and psychology. Using such utility functions economists will not only provide more accurate welfare predictions, but we will also increase the number of behavioral phenomena that we are able to explain. Finally, we provide as an application a model of the psychological defenses.
    Keywords: hedonic adaptation; evolution; expectations; decision utility; experienced utility
    JEL: B52 I00
    Date: 2009–07–29

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