New Economics Papers
on Economics of Happiness
Issue of 2013‒12‒29
thirteen papers chosen by

  1. How Are You, My Dearest Mozart? Well-being and Creativity of Three Famous Composers Based on their Letters By Borowiecki, Karol Jan
  2. Upward Social Mobility, Well-being and Political Preferences: Evidence from the BHPS By Andrew E. Clark; Emanuela D'Angelo
  3. Alternative weighting structures for multidimensional poverty assessment By Miniaci, Raffaele; Han, Wei; Cavapozzi, Danilo
  4. Relationship between trade openness and economic growth of India: A time series analysis By Monojit, Chatterji; Sushil, Mohan; Sayantan Ghosh, Dastidar
  5. Testing the Tunnel Effect: Comparison, Age and Happiness in UK and German Panels By Felix, FitzRoy; Michael, Nolan; Max, Steinhardt; David, Ulph
  6. My Group Beats Your Group: Evaluating Non-Income Inequalities By Tugce, Cuhadaroglu
  7. Causal linkages between work and life satisfaction and their determinants in a structural VAR approach By Alex Coad; Martin Binder
  8. Age, Life-satisfaction, and Relative Income – Insights from the UK and Germany By Felix R., FitzRoy; Michael, Nolan; Max F., Steinhardt
  9. Russia’s regions: governance and Well-being, 2000-2008 By Alisher Akhmedjonov; Irina N. Il’ina; Carol S. Leonard; Zafar Nazarov; Evgenij E. Plisetskij; Elena S. Vakulenko
  10. The Wealth, Health and Wellbeing of Ireland's Older People Before and During the Economic Crisis By Barrett, Alan; O'Sullivan, Vincent
  11. Corporate Sports Activity and Work Morale: Evidence from a Japanese Automobile Maker By Sasaki, Masaru; Ohtake, Fumio
  12. Does Religion Affect Economic Growth and Happiness? Evidence from Ramadan By Filipe R. Campante; David H. Yanagizawa-Drott
  13. Happiness, Dynamics and Adaptation By Piper, Alan T.

  1. By: Borowiecki, Karol Jan (Department of Business and Economics)
    Abstract: The well-being of a person is reflected in the language used. Building on 1,400 letters written by three famous music composers, I obtain well-being indices that span their lifetime. The validity of this methodology is shown by linking the indices with biographical information and through estimation of the determinants of well-being. I find, consistent with the literature, that work-related engagements and accomplishments are positively related with well-being, while poor health or death of a relative is detrimental. I then exploit the data and provide quantitative evidence on the existence of a causal impact of negative emotions on outstanding creativity, an association hypothesized across several disciplines since the Antiquity; however, not yet convincingly established for the case of extraordinary achievers.
    Keywords: Well-being; happiness; positive emotions; negative emotions; creativity; health; labor; composer; letters; methodology; music history
    JEL: D60 I31 J24 N33 Z11
    Date: 2013–12–17
  2. By: Andrew E. Clark; Emanuela D'Angelo
    Abstract: The paper uses 18 waves of BHPS data to provide evidence of the roles of both own social status and upward mobility relative to one's parents on job and life satisfaction, preferences for redistribution, pro-public sector attitudes and voting. Both own social status and greater mobility with respect to parents are positively associated with subjective well-being. However, this symmetric effect disappears for political preferences. While greater social status is associated with less favourable attitudes to redistribution and the public sector, greater upward mobility is associated with more Left-wing attitudes. These attitudes translate into actual reported voting behaviour. Upwards social mobility produces satisfied Left-wingers.
    Keywords: Social Mobility, Satisfaction, Redistribution, Inequality, Voting
    JEL: A14 C25 D31 D63 J28 J62
    Date: 2013–12
  3. By: Miniaci, Raffaele; Han, Wei; Cavapozzi, Danilo (Groningen University)
    Abstract: A multidimensional poverty assessment requires a weighting scheme to aggregate the well-being dimensions considered. We use Alkire and Foster?s (2011a) framework to discuss the channels through which a change of the weighting structure affects the outcomes of the analysis in terms of overall poverty assessment, its dimensional and subgroup decomposability and policy prescriptions. We exploit the Survey on Health, Ageing and Retirement in Europe to evaluate how alternative weighting structures affect the measurement of poverty for the population of over 50s in ten European countries. Further, we show that in our empirical exercise the results based on hedonic weights estimated on the basis of life satisfaction self-assessments are robust to the presence of heterogeneous response styles across respondents.
    Date: 2013
  4. By: Monojit, Chatterji; Sushil, Mohan; Sayantan Ghosh, Dastidar
    Abstract: The paper aims to examine the empirical relationship between trade openness and economic growth of India for the time period 1970-2010. Trade openness is a multi-dimensional concept and hence measures of both trade barriers and trade volumes have been used as proxies for openness. The estimation results from Vector Autoregressive method suggest that growth in trade volumes accelerate economic growth in case of India. We do not find any evidence from our analysis that trade barriers lower growth.
    Keywords: Trade openness, economic growth, India, time series analysis,
    Date: 2013
  5. By: Felix, FitzRoy; Michael, Nolan; Max, Steinhardt; David, Ulph
    Abstract: In contrast to previous results combining all ages we find positive effects of comparison income on happiness for the under 45s, and negative effects for those over 45. In the BHPS these coefficients are several times the magnitude of own income effects. In GSOEP they cancel to give no effect of effect of comparison income on life satisfaction in the whole sample, when controlling for fixed effects, and time-in-panel, and with flexible, age-group dummies. The residual age-happiness relationship is hump-shaped in all three countries. Results are consistent with a simple life cycle model of relative income under uncertainty.
    Keywords: subjective life-satisfaction, comparison income, reference groups, age, welfare,
    Date: 2013
  6. By: Tugce, Cuhadaroglu
    Abstract: This paper proposes a new methodology, the Domination Index, to evaluate non-income inequalities between social groups such as inequalities of educational attainment, occupational status, health or subjective well-being. The Domination Index does not require specific cardinalisation assumptions, but only uses the ordinal structure of these non-income variables. We approach from an axiomatic perspective and show that a set of desirable properties for a group inequality measure when the variable of interest is ordinal, characterizes the Domination Index up to a positive scalar transformation. Moreover we make use of the Domination Index to explore the relation between inequality and segregation and show how these two concepts are related theoretically.
    Keywords: Between-Group Inequality, Social Inequality, Segregation, Inequality Measurement,
    Date: 2013
  7. By: Alex Coad; Martin Binder
    Abstract: Work and life satisfaction depend on a number of pecuniary and non-pecuniary factors at the workplace and determine these in turn. We analyze these causal linkages using a structural vector autoregression approach for a German sample of the working populace from 1984-2008.
    Date: 2013–12–18
  8. By: Felix R., FitzRoy; Michael, Nolan; Max F., Steinhardt
    Abstract: We first confirm previous results with the German Socio-Economic Panel by Layard et al. (2010), and obtain strong negative effects of comparison income. However, when we split the sample by age, we find quite different results for reference income. The effects on lifesatisfaction are positive and significant for those under 45, consistent with Hirschman’s (1973) ‘tunnel effect’, and only negative (and larger than in the full sample) for those over 45, when relative deprivation dominates. Thus for young respondents, reference income’s signalling role, indicating potential future prospects, can outweigh relative deprivation effects. Own-income effects are also larger for the older sample, and of greater magnitude than the comparison income effect. In East Germany the reference income effects are insignificant for all. With data from the British Household Panel Survey, we confirm standard results when encompassing all ages, but reference income loses significance in both age groups, and most surprisingly, even own income becomes insignificant for those over 45, while education has significant negative effects.
    Keywords: subjective life-satisfaction, comparison income, reference groups, age, welfare,
    Date: 2013
  9. By: Alisher Akhmedjonov (Zirve University); Irina N. Il’ina (National Research University Higher School of Economics); Carol S. Leonard (National Research University Higher School of Economics); Zafar Nazarov (Cornell University); Evgenij E. Plisetskij (National Research University Higher School of Economics); Elena S. Vakulenko (National Research University Higher School of Economics)
    Abstract: This paper assesses the impact of the quality of governance on economic performance in Russia’s 83 regions (Oblasts, Republics, Krais and Okrugs) from 2000 to 2008, a period of rapid economic advancement. Defining governance broadly as how authority is exercised, and using as a proxy a measure of the investment risk by region, this paper contributes to the literature on identifying the economic impact of governance. Our results find a significant association between governance in Russia’s diverse regions and economic well-being, that is, we find a performance gap in government practices. Specifically, our study shows that the main components of effective governance are the ability of the government to run effective public health programs aimed at decreasing the overall mortality rate among the working-age population, to create fair labor market conditions for all individuals who are still capable of working, and to improve the investment climate in the region leading to a higher level of investment in fixed assets. Our results implicitly suggest that effective governance comprises the tangible aspects of policymaking such as the adoption of effective public health, investment and labor policies and most importantly, for the regions of Russian Federation, although effective governance can be also an artifact of unobserved and unmeasurable managerial attributes of the local government to implement federal and region level laws and regulations
    Keywords: governance, Russian regions, well-being, economy, Russia, investment, investment risk, mortality, public health, labor market
    JEL: O47
    Date: 2013
  10. By: Barrett, Alan (ESRI, Dublin); O'Sullivan, Vincent (Trinity College Dublin)
    Abstract: The economic crisis of 2008/9 was felt more acutely in Ireland relative to elsewhere and culminated in the international bailout in 2010. Given the economic collapse, Ireland provides an ideal case-study of the link between wealth collapses and movements in variables such as health and well-being. Using nationally-representative samples of older people collected before and during the crisis, we show that mean net assets fell by 45 percent between 2006/7 and 2012/13. In spite of this massive fall in wealth, measures of health and well-being remained broadly unchanged. However, expectations about future living standards became less optimistic. The results tend to support the findings of other recent studies that recessions do not have widespread negative effects on health and well-being.
    Keywords: recession, wealth, health, wellbeing
    JEL: D31 J14
    Date: 2013–12
  11. By: Sasaki, Masaru (Osaka University); Ohtake, Fumio (Osaka University)
    Abstract: This paper estimates the factors affecting the relationship between the wins and losses of corporate sports club teams and the work morale of employees, using an original survey of employees from a selected Japanese automobile maker. We find that corporate sports club teams' performance is an important factor influencing the work morale of older employees and employees who work with colleagues belonging to those teams in the same division. We can say statistically that the impacts of teams' wins and losses on changes in work morale of older employees at the individual level are symmetric; that is, the work morale of employees is significantly raised by own teams' wins but reduced by own teams' losses.
    Keywords: work morale, corporate sports, subjective well-being analysis, Japan
    JEL: L62 M52 M54
    Date: 2013–12
  12. By: Filipe R. Campante; David H. Yanagizawa-Drott
    Abstract: We study the economic effects of religious practices in the context of the observance of Ramadan fasting, one of the central tenets of Islam. To establish causality, we exploit variation in the length of the fasting period due to the rotating Islamic calendar. We report two key, quantitatively meaningful results: 1) longer Ramadan fasting has a negative effect on output growth in Muslim countries, and 2) it increases subjective well-being among Muslims. We then examine labor market outcomes, and find that these results cannot be primarily explained by a direct reduction in labor productivity due to fasting. Instead, the evidence indicates that Ramadan affects Muslims' relative preferences regarding work and religiosity, suggesting that the mechanism operates at least partly by changing beliefs and values that influence labor supply and occupational choices beyond the month of Ramadan itself. Together, our results indicate that religious practices can affect labor supply choices in ways that have negative implications for economic performance, but that nevertheless increase subjective well-being among followers.
    JEL: E20 J20 O40 O43 Z12
    Date: 2013–12
  13. By: Piper, Alan T.
    Abstract: This investigation employs dynamic panel analysis to provide new insights into the phenomenon of adaptation. Using the British Household Panel Survey, it is demonstrated that happiness is largely (but not wholly) contemporaneous. This can help provide explanations for previous findings, where many events entered into in the past are often adapted to (like marriage and divorce), and others are not adapted to (like unemployment and poverty). An event – no matter when entered into - must have a contemporaneous impact on either the life of an individual or an individual’s perception of their life (or both) for it to be reflected in self-reported life satisfaction scores. This contemporaneous finding also explains other results in the literature about the well-being legacy of events.
    Keywords: Adaptation, Life Satisfaction, Happiness, Dynamic Panel Analysis, GMM
    JEL: C23 I31 J12 J63 J64
    Date: 2013–12

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