New Economics Papers
on Economics of Happiness
Issue of 2014‒08‒16
ten papers chosen by

  1. Individual and Societal Wisdom: Explaining the Paradox of Human Aging and High Well-Being By Jeste, Dilip V.; Oswald, Andrew J.
  2. Health, Work and Working Conditions: A Review of the European Economic Literature By Thomas Barnay
  3. Re-employment Expectations and the Eye of Providence By Sonja C. Kassenboehmer; Sonja G. Schatz
  4. Shelter from the Storm: Upgrading Housing Infrastructure in Latin American Slums By Sebastián Galiani; Paul Gertler; Ryan Cooper; Sebastián Martínez; Adam Ross; Raimundo Undurraga
  5. Impacts of Climate Change on Dengue Risk in Brazil By Paula C. Pereda; Tatiane A. de Menezes; Denisard Alves
  6. Should Parents Work Away from or Close to Home? The Effect of Temporary Parental Absence on Child Poverty and Children’s Time Use in Vietnam By Nguyen Viet Cuong; Vu Hoang Linh
  7. Improving Well-Being in the United States By Aida Caldera Sánchez; Patrick Lenain; Sarah Flèche
  8. Reducing Income Inequality and Poverty and Promoting Social Mobility in Korea By Randall S. Jones; Satoshi Urasawa
  9. Changes in Family Policies and Outcomes: Is there Convergence? By Willem Adema; Nabil Ali; Olivier Thévenon
  10. The Good African Society Index By Ferdi Botha

  1. By: Jeste, Dilip V. (University of California); Oswald, Andrew J. (University of Warwick and CAGE abstract- Objective: Although human aging is characterized by loss of fertility and progressive decline in physical abilities, later life is associated with better psychological health and well-being. Furthermore, there has been an unprecedented increase in average lifespan over the past century without corresponding extensions of fertile and healthy age spans. We propose a possible explanation for these paradoxical phenomena. Method- We reviewed the relevant literature on aging, well-being, and wisdom. Results-An increase in specific components of individual wisdom in later life may make up for the loss of fertility as well as declining physical health. However, current data on the relationship between aging and individual wisdom are not consistent, and do not explain increased longevity in the general population during the past century. We propose that greater societal wisdom (including compassion) may account for the notable increase in average lifespan over the last century. Data in older adults with serious mental illnesses are limited, but suggest that many of them too experience improved psychosocial functioning, although their longevity has not yet increased, suggesting persistent stigma against mental illness and inadequate societal compassion.Conclusions- Research should focus on the reasons for discrepant findings related to ageassociated changes in different components of individual wisdom; also, more work is needed on the construct of societal wisdom. Studies of wisdom and well-being are warranted in older people with serious mental illnesses, along with campaigns to enhance societal compassion for these disenfranchised individuals. Finally, effective interventions to enhance wisdom need to be developed and tested.)
    Keywords: Life-cycle happiness, subjective well-being, wisdom, psychiatry, U shape
    Date: 2014
  2. By: Thomas Barnay (ERUDITE - Equipe de Recherche sur l'Utilisation des Données Individuelles Temporelles en Economie - Université Paris-Est Créteil Val-de-Marne (UPEC) : EA437 - Université Paris-Est Marne-la-Vallée (UPEMLV), TEPP - Travail, Emploi et Politiques Publiques - CNRS : FR3435 - Université Paris-Est Marne-la-Vallée (UPEMLV))
    Abstract: Economists have traditionally been very cautious when studying the interaction between employment and health because of the two-way causal relationship between these two variables: health status influences the probability of being employed and, at the same time, working affects the health status. Because these two variables are determined simultaneously, researchers control endogeneity skews (e.g., reverse causality, omitted variables) when conducting empirical analysis. With these caveats in mind, the literature finds that a favourable work environment and high job security lead to better health conditions. Being employed with appropriate working conditions plays a protective role on physical health and psychiatric disorders. By contrast, non-employment and retirement are generally worse for mental health than employment, and overemployment has a negative effect on health. These findings stress the importance of employment and of adequate working conditions for the health of workers. In this context, it is a concern that a significant proportion of European workers (29%) would like to work fewer hours because unwanted long hours are likely to signal a poor level of job satisfaction and inadequate working conditions, with detrimental effects on health. Thus, in Europe, labour-market policy has increasingly paid attention to job sustainability and job satisfaction. The literature clearly invites employers to take better account of the worker preferences when setting the number of hours worked. Overall, a specific "flexicurity" (combination of high employment protection, job satisfaction and active labour-market policies) is likely to have a positive effect on health.
    Keywords: work, health, working conditions, employment, causality, selection
    Date: 2014–07–24
  3. By: Sonja C. Kassenboehmer (Centre for Health Economics, Monash University; and Institute for the Study of Labor (IZA)); Sonja G. Schatz (Mercator School of Management, University of Duisburg-Essen)
    Abstract: Using a nationally representative panel dataset, this study investigates the extent and impact of systematic misconceptions of the currently unemployed concerning their statistical reemployment probability, affecting their labor market behavior in a sub-optimal way. Specifically, people with unemployment experience of 3 to 5 years significantly underestimate their objective re-employment probabilities as determined by the econometrician’s all-seeing ‘Eye of Providence’. Simply having information concerning the individuals’ previous unemployment experience is sufficient to make more accurate predictions than the individuals themselves. People who underestimate their re-employment probability are less likely to search actively for a job and indeed more likely to exit the labor force. If re-employed, they are more likely to accept lower wages, work fewer hours, work part-time and experience lower levels of job satisfaction. This information can be used by employment agency case workers to counsel clients better and prevent client adverse behavior and outcomes.
    Keywords: Job insecurity, re-employment expectations, prediction errors
    JEL: J64 J01 D84
    Date: 2014–07
  4. By: Sebastián Galiani; Paul Gertler; Ryan Cooper; Sebastián Martínez; Adam Ross; Raimundo Undurraga
    Abstract: This paper provides empirical evidence on the causal effects that upgrading slum dwellings has on the living conditions of the extremely poor. In particular, we study the impact of providing better houses in situ to slum dwellers in El Salvador, Mexico and Uruguay. We experimentally evaluate the impact of a housing project run by the NGO TECHO which provides basic pre-fabricated houses to members of extremely poor population groups in Latin America. The main objective of the program is to improve household well-being. Our findings show that better houses have a positive effect on overall housing conditions and general well-being: treated households are happier with their quality of life. In two countries, we also document improvements in children's health; in El Salvador, slum dwellers also feel that they are safer. We do not find this result, however, in the other two experimental samples. There are no other noticeable robust effects on the possession of durable goods or in terms of labor outcomes. Our results are robust in terms of both internal and external validity because they are derived from similar experiments in three different Latin American countries.
    Keywords: Health, Housing, Housing infrastructure, Slum dwellers, NGO Techo, Slums
    Date: 2014–07
  5. By: Paula C. Pereda; Tatiane A. de Menezes; Denisard Alves
    Abstract: Climate-sensitive health problems kill millions every year and undermine the physical and psychological well-being of millions more. To identify the climate impacts on dengue risk in Brazil, a comparative case study is used based on the synthetic controls approach. The South and Northeast regions of Brazil are compared to the rest of the country in order to identify those impacts. The results suggest that dengue is more prevalent in warmer regions, but the humidity conditions and amount of rainfall seem fundamental for increase of the diseases prevalence in temperate climate regions or drier tropical regions of the country. On the other hand, the increase in rainfall in the rainiest tropical areas could diminish the diseases prevalence, as standing water accumulations might be washed away. Therefore, due to expected climate changes in the future, the dengue fever distribution in the country might change, with the disease migrating from the north to the south. Public policy's role in minimizing these effects in the country should be focused on anticipating the proper climate conditions for dengue incidence by using integrated actions among local authorities.
    Keywords: Climate Change, Health Policy, Human health, Dengue fever, Synthetic control method, Climate change impacts on health
    Date: 2014–07
  6. By: Nguyen Viet Cuong; Vu Hoang Linh
    Abstract: Working away from home might bring higher earnings than working near home. However, the absence of parents due to work can have unexpected effects on children. This paper examines the effects of the temporary absence of parents on the well-being of children aged 5–8 years old in Vietnam, using indicators of household poverty, per capita consumption expenditure, and child time allocation. The paper relies on OLS and fixed-effects regression and panel data from the Young Lives surveys in 2007 and 2009. It finds a positive correlation between parental absence and per capita expenditure. Parental absence tends to increase per capita food expenditure instead of per capita nonfood expenditure. Regarding the way children spend their time, there are no statistically significant effects of parental absence.
    Keywords: parental migration, child poverty, remittances, impact evaluation, Vietnam.
    JEL: O15 R23 I32
    Date: 2014–07–24
  7. By: Aida Caldera Sánchez; Patrick Lenain; Sarah Flèche
    Abstract: Life is quite good in the United States compared to other OECD countries, thanks to strong economic growth and technological progress having lifted average income to high levels. Nonetheless, there is evidence that the benefits from growth have not been sufficiently broad based. Self-reported happiness increases with income, an issue particularly resonant in a country with among the highest levels of income inequality in the OECD and a pattern of inequality that appears to be moving toward even more concentration at the very top at the expense of the middle class and the poor. Working hours that remain among the longest in the OECD are also creating challenges for work-life balances, child education, personal care and leisure. These pressures are contributing to higher job strain and work-related stress with unhealthy consequences, including for mental health, and a detrimental impact on employability and medical costs. While these trends cannot be easily reversed, a number of policy options are being usefully rolled out and other initiatives are being considered: federal-level policies improving access to health care and early-childhood education, state-level initiatives favouring workplace flexibility, firm-level investments in job quality and greater attention to the health consequences of job-stress. If successfully adopted, they would go a long way toward improving the well-being of American working families. This Working Paper relates to the 2014 OECD Economic Survey of United States ( States). Améliorer le bien-être aux États-Unis Par comparaison avec d’autres pays de l'OCDE, il fait relativement bon vivre aux États-Unis grâce à une croissance économique soutenue et des progrès technologiques qui ont porté le revenu moyen à un niveau élevé. Néanmoins, des pans entiers de la population américaine n’ont pas tiré avantage de ces améliorations. Après deux décennies de stagnation des revenus du travail pour une majorité des travailleurs, à laquelle s’ajoutent les conséquences de la Grande récession, les familles de la classe moyenne doivent faire à des difficultés financières. La durée du travail aux États-Unis reste en outre l’une des plus longues de la zone OCDE, ce qui accentue les difficultés rencontrées par les Américains pour concilier vie professionnelle et vie privée, élever leurs enfants et se libérer du temps pour leurs loisirs et activités personnelles. Ces pressions contribuent à une augmentation des tensions et du stress au travail, qui ont des effets négatifs sur la santé, y compris mentale, ainsi que des conséquences néfastes sur l’employabilité et les coûts médicaux. S’il est difficile d’inverser ces tendances, plusieurs moyens d’action utiles sont actuellement mis en oeuvre, tandis que d’autres initiatives sont à l’étude : politiques fédérales améliorant l’accès aux soins de santé et à l’éducation préscolaire, initiatives menées par les États en faveur de la flexibilité au travail, investissements consentis par les entreprises pour améliorer la qualité des emplois et attention accrue accordée aux effets du stress au travail sur la santé. Si ces mesures sont effectivement adoptées, elles pourraient grandement contribuer à améliorer le bien-être des ménages américains qui travaillent. Ce Document de travail se rapporte à l'Étude économique de l'OCDE de États-Unis 2014 ( Unis).
    Keywords: quality of life, provision and effects of welfare programmes, job satisfaction, education, wage level and structure, time allocation and labour supply, éducation, répartition du temps et offre de main d'oeuvre, qualité de vie, satisfaction au travail, allocation et effets des programmes sociaux, niveau et structure des salaires
    JEL: I24 I30 I38 J22 J28 J31
    Date: 2014–07–21
  8. By: Randall S. Jones; Satoshi Urasawa
    Abstract: To strengthen social cohesion, a top government priority, it is essential to address the labour market roots of inequality by breaking down dualism to reduce the share of non-regular workers and to boost the employment ratio toward the government’s 70% target. Education reforms are also important to enhance social mobility. Social welfare programmes should be improved to make them more effective, especially among the elderly, where the relative poverty rate is 49%. In addition, reforms are needed now to develop an effective three-pillar system of retirement income based on the National Pension Scheme, company pensions and individual savings. High household debt also has adverse implications for equity, as well as for growth, as individuals with low income and credit ratings have limited access to financial markets and many are delinquent on their loans. Policies to offer credit to such households and restructure their debt, while limiting moral hazard and developing market-based lending, are essential. This Working Paper relates to the 2014 OECD Economic Survey of Korea ( Réduire les inégalités de revenu et la pauvreté et promouvoir la mobilité sociale en Corée Pour renforcer la cohésion sociale, l’une des premières priorités des autorités coréennes, il est primordial de s’attaquer au dualisme du marché du travail, source d’inégalités, en réduisant la proportion de travailleurs non réguliers et en favorisant le rapprochement du taux d’emploi sur l’objectif de 70 % fixé par les autorités. Des réformes de l’éducation sont également essentielles pour une plus grande mobilité sociale. Les programmes de protection sociale doivent être améliorés pour qu’ils soient plus efficaces, notamment pour les personnes âgées, dont le taux de pauvreté relative est de 49 %. En outre, des réformes sont nécessaires pour mettre en place un régime de retraite à trois piliers : régime national de retraite, retraites d’entreprise et épargne individuelle. Par ailleurs, le haut niveau d’endettement des ménages a des effets négatifs en termes d’égalité car les ménages les plus modestes et les moins solvables n’ont guère accès au marché du crédit et leurs taux de défaillance sont élevés. Il est important d’élaborer une offre de crédit en leur faveur et de réaménager leur dette, tout en limitant l’aléa moral et en développant le recours aux mécanismes du marché dans l’activité de prêt. Ce Document de travail se rapporte à l’Étude économique de l’OCDE de la Corée, 2014 (
    Keywords: female employment, household debt, company pensions, hagwons, 70% roadmap, National Happiness Fund, non-regular workers, retirement allowance, basic old-age pension, labour market dualism, National Pension Scheme, Basic Livelihood Security Programme, elderly poverty, dualisme du marché du travail, hagwons, minimum vieillesse, retraites d’entreprise, indemnité de retraite, pauvreté chez les plus âgés, endettement des ménages, régime national de retraite, emploi des femmes, travailleurs non réguliers
    JEL: H55 J26
    Date: 2014–07–24
  9. By: Willem Adema; Nabil Ali; Olivier Thévenon
    Abstract: This paper presents new information on trends in family and child outcomes and policies over the past decades, in order to assess whether there has been any convergence over time across OECD and EU countries. Important drivers of population structure such as life expectancy and fertility rates are becoming more similar across countries as are marriage and divorce rates. Increased educational attainment has contributed to greater female employment participation and convergence therein across countries. Child well-being outcomes show a more mixed pattern with improvements and convergence in infant mortality, but varying trends in child poverty across countries.
    Keywords: female employment, Taxes and Benefits, Child Care and Parental leave, Family and Child outcomes
    JEL: D1 J12 J13 J18
    Date: 2014–07–11
  10. By: Ferdi Botha
    Abstract: This paper constructs a Good Society Index for 45 African countries, termed the Good African Society Index (GASI). The GASI consists of nine main indexes: (i) economic sustainability, (ii) democracy and freedom, (iii) child well-being, (iv) environment and infrastructure, (v) safety and security, (vi) health and health systems, (vii) integrity and justice, (viii) education, and (xi) social sustainability and social cohesion. Each component is split into four sub-components for a total of 36 indicators. Tunisia ranks highest on the GASI, followed by Cape Verde and Botswana. Chad has the lowest GASI score, followed by Central African Republic and Cote d’Ivoire. The GASI is strongly related to the 2012 Human Development Index and, to a lesser extent, GNI per capita.
    Keywords: Good Society Index, Well-being, quality of life, suffering, Africa
    JEL: I31 O55 Z13
    Date: 2014

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