nep-hap New Economics Papers
on Economics of Happiness
Issue of 2015‒05‒02
eight papers chosen by
Viviana Di Giovinazzo
Università degli Studi di Milano-Bicocca

  1. Is happiness a predictor of election results? By George Ward
  2. The future of the German industrial relations model By David Marsden
  3. Brazilian Population Ageing: Differences in Well-being by Rural and Urban Areas By Ana Amélia Camarano
  4. The impact of CAF enablers on job satisfaction: the case of the Slovenian law enforcement agency By Tomaževič, Nina; Seljak, Janko; Aristovnik, Aleksander
  5. Wplyw efektywnosci instytucji w kontekscie gospodarki opartej na wiedzy na jakosc zycia w Unii Europejskiej. Badanie panelowe dla lat 2004-2010 By Adam P. Balcerzak; Michal Bernard Pietrzak
  6. Conspicuous Work: Peer Working Time, Labour Supply and Happiness for Male Workers By Collewet, Marion; de Grip, Andries; de Koning, Jaap
  7. Permanent Income and Subjective Well-Being By Albert Park; Shu Cai
  8. Home-Ownership, Unemployed's Job Search Behavior and Post-Unemployment Outcomes By Caliendo, Marco; Gielen, Anne C.; Mahlstedt, Robert

  1. By: George Ward
    Abstract: Is it in politicians’ interest to focus policy on subjective well-being (SWB)? Many governments and international organisations have recently begun to measure progress at least partly in terms of the population’s SWB or “happiness”. This paper investigates the extent to which citizens themselves judge national success in such terms. Using cross-country panel data, the analysis shows that the electoral fate of governing parties is associated not only with the state of the macroeconomy—as a substantial literature on ‘economic voting’ suggests—but also with the electorate’s wider well-being. A country’s aggregate level of SWB is able to account for more of the variance in government vote share than standard macroeconomic variables. This is consistent with a simple political agency model, and has implications for the incentives faced by politicians to act in the interests of voters.
    Keywords: Subjective well-being; political agency; elections
    JEL: I31
    Date: 2015–03
  2. By: David Marsden
    Abstract: The paper examines recent evidence on the erosion of the German industrial relations model. Although its coverage has declined, much of this has occurred in smaller and newer establishments, and compared with Britain, it has remained solid in the areas of Germany's traditional industrial strength. This is explained by the nature of high performance work systems that involve flexible working and on-the-job problem-solving. Both countries have modernised their work systems in recent decades, with German industrial firms maintaining higher degrees of worker autonomy and learning and British ones relying more on managerial control. The survival of the German model in this sector, as compared with services, is attributed to the role of such work systems in the high end of international competition. A model is developed to explain why stable cooperation within these work relationships is enhanced by means of a strong institutional framework. It is then used to explain why employers in the sectors using these systems have continued to work within these institutions. It is argued that employers’ increased focus on the match between commercial needs and workplace institutions has contributed to the growing segmentation within German industrial relations which has been widely documented, and represents a departure from the classical post-war German model. The article finishes by asking how far this can go before damaging social and political cohesion.
    Keywords: Subjective well-being; political agency; elections
    JEL: J24 J5 M55
    Date: 2015–03
  3. By: Ana Amélia Camarano
    Abstract: The main purpose of this paper is to discuss the relationship between ageing and dependence and the role of social policies in Brazil according to rural and urban areas. In other words, is being elderly in rural areas different from being elderly in urban areas? And if it is found to be so, which dimension of life is affected? How is the social security policy affecting these conditions? As Brazilian national data mask regional differences, the paper also places attention on certain differences between the Northeast (the Brazilian poorest region) and the Southeast (the richest region in this process. In this paper, old age is considered to start at the age of 60. Four dimensions of elderly life are considered, to note: familial arrangements, health conditions, economic activities and income. This is considered taking into account the composition of this group by age and gender according to rural and urban areas. The main data analysed are those from the General Household Surveys (PNAD) of 1981 and 1999. Empirical evidence has shown that in Brazil the relationship between ageing and dependence is not so straightforward. It has shown that the Brazilian elderly are living longer and better. Based on these, one can say that their gains were substantial throughout the studied time period. Poverty and the proportion of elderly without any earnings whatsoever decreased dramatically. They were more marked for the elderly living in rural areas, especially among females. Nevertheless, there is less poverty among the elderly living in urban areas as well. Actually, there is less poverty in general among urban families. Relative better life conditions experienced by the elderly population are contrasted with the effects of the continuous economic crisis experienced by the Brazilian economy. This has affected the young population more through unemployment, violence, drugs, teen-age pregnancy, marital disruption, etc. Poverty increased among the non-elderly urban population aged 25 to 59. As a result, there has been an increase in the time adult children spend as dependents of their parents. The composition of the families with elderly living in has changed to become more complex than the expected “empty nest”. Summarizing, one can say that there has been a change of status for the elderly within their own families, modifying their traditional role of dependent to that of provider. Three factors have been important in enabling such a situation: the widespread coverage of social security, health policies and improvements in medical technology. Nevertheless, better life condition for the elderly has meant marked costs in terms of social security benefits and health policies. Concern with social security costs is a frequent theme in literature. Nevertheless, the unexpected effects of the spread of social security benefit coverage on the elderly and their families should not be neglected in any public policy evaluation. There are 13 million benefited families. This huge value characterises the social security policy as a modern social policy capable of reducing at lest partially, Brazilian poverty. O principal objetivo deste trabalho é discutir a relação entre envelhecimento e dependência e o papel das políticas sociais perante as condições de domicílio dos entrevistados. Pergunta-se se ser idoso hoje é diferente de ser idoso no passado. Se isto for verdade, quais as condições de vida que são afetadas? Como as políticas de previdência social estão afetando essas condições? Visto que os dados em nível nacional mascaram as diferenças regionais, as diferenças regionais entre o Nordeste e o Sudeste, neste processo, são levadas em conta. Considera-se como idoso a população de mais de 60 anos. Quatro dimensões de vida do idoso são observadas: arranjos familiares, condições de saúde, atividades econômicas e renda. Leva-se em conta, também, a composição deste grupo etário por idade e sexo de acordo com as áreas rurais e urbanas. Os dados analisados são os das PNADs de 1981 e 1999. A evidência empírica mostra que, no Brasil, a relação entre envelhecimento e dependência não é tão direta. Os idosos brasileiros em 1999 viviam melhor do que em 1981, isto medido em termos de renda, níveis de pobreza, condições de saúde e esperança de vida. A proporção de idosos pobres e sem nenhum rendimento decresceu substancialmente no período. O impacto foi maior entre a população rural e, em especial, a feminina. As melhores condições de vida da população idosa são contrastadas com os efeitos das freqüentes crises econômicas experimentadas pela população brasileira. Estas têm afetado mais a população jovem através de desemprego, violência, drogas, gravidez precoce, separações etc. O nível de pobreza cresceu entre a população de 25 a 59 anos. Como resultado, aumentou o tempo em que os filhos adultos passam na condição de dependentes de seus pais. A composição das famílias com idosos está se modificando para se tornar mais complexa do que o esperado “ninho vazio”. Sumariando, pode-se dizer que tem havido uma mudança de status do idoso dentro da família, dada a modificação do seu papel tradicional de dependente para o de provedor. Três fatores foram responsáveis para isto: a expansão da cobertura da seguridade social e das políticas de saúde e os avanços na tecnologia médica. Entretanto, melhores condições de vida para os idosos têm implicado custos elevados para a seguridade social e as políticas de saúde. Entretanto, os efeitos inesperados da expansão da cobertura da seguridade social não devem ser negligenciados em nenhuma avaliação de política pública. São 13 milhões de famílias beneficiadas. Esse valor é suficiente para caracterizar a política de seguridade social como uma política moderna capaz de reduzir, pelo menos parcialmente, a pobreza no Brasil.
    Date: 2015–01
  4. By: Tomaževič, Nina; Seljak, Janko; Aristovnik, Aleksander
    Abstract: In recent decades, public sector organizations in Slovenia and across the European Union have been placing ever more emphasis on the quality and excellence of their operations. For this purpose, they use different management tools and/or excellence models such as the EFQM model (European Foundation for Quality Management), CAF (Common Assessment Framework), BSC (Balanced Scorecard) etc.. An important aspect of excellence in any organization involves the employees, i.e. human resources management. In spring 2012 a study was conducted within the Slovenian Law Enforcement Agency. The main purpose of the paper is to investigate the correlation between the results of a self-assessment of the CAF enablers and job satisfaction of employees, having in mind that the evaluation regarding both the CAF enablers and job satisfaction was made by the employees within the same questionnaire. A multiple regression model was applied to test the intensity of the influence of the CAF enablers on total job satisfaction and on three sets of facets of job satisfaction, designed with factor analysis. The correlation between the employees’ evaluation of their total satisfaction and individual facets of their satisfaction and the evaluation of specific CAF enablers can provide management with a useful starting point for improving management and execution processes in the Slovenian Law Enforcement Agency.
    Keywords: job satisfaction, CAF model, enablers, law enforcement agency, salary, reward system, facets of satisfaction, excellence
    JEL: C14 J45 M51
    Date: 2014
  5. By: Adam P. Balcerzak (Nicolaus Copernicus University, Poland); Michal Bernard Pietrzak (Nicolaus Copernicus University, Poland)
    Abstract: The article concentrates on the problem of the efficiency of the institutional system of the European Union countries in relation to the potential of the knowledge-based economy (KBE) and its impact on quality of life. In order to define the efficiency of the institutional system, the authors refereed to the analytical structure of the new institutional economics, in particular, the transaction costs theory. On this basis, it is assumed that effective institutional factors are conducive to the reduction of transaction costs. To measure the effectiveness of the institutional system authors proposed a synthetic indicator, which has been constructed with application of the modified TOPSIS method. As diagnostic variables the authors adopted the variables on four aspects characterizing the efficiency of the institutional system in the context of the country's ability to exploit the potential of KBE. The aspects were related to regulations aimed at promoting entrepreneurship, the issue of law institutions conducive to maintaining low level of transaction costs and improving the efficiency of the market mechanism, the issue of economy competitiveness and efficiency of labor markets and the quality of financial market institutions. The data were obtained from the database of Fraser Institute that is created for the purpose of the annual Economic Freedom of the World report. For the measurement of quality of life the Human Development Index was used. The main aim of this article was an attempt to assess the relationship between the level of institutional effectiveness in the context of KBE and quality of life for residents of the European Union countries in 2004-2010. In the econometric analysis the dynamic panel model was used for the 24 countries of the European Union, which has led to the identification of the positive impact of the efficiency of the institutions on the quality of life.
    Keywords: effectiveness of the institutional system, quality of institutions, theory of transaction costs, quality of life, Human Development Index, knowledge-based economy, TOPSIS, dynamic panel model
    Date: 2015–04
  6. By: Collewet, Marion (Maastricht University); de Grip, Andries (ROA, Maastricht University); de Koning, Jaap (Erasmus University Rotterdam)
    Abstract: This paper uncovers 'conspicuous work' as a new form of status seeking that can explain social interactions in labour supply. We analyse how peer working time relates to both labour supply and happiness for Dutch male workers. Using a unique measure of peer weekly working time, we find that men's working time increases with that of their peers and that peer working time is negatively related to men's happiness. These findings are consistent with a 'conspicuous work' model, in which individuals derive status from working time.
    Keywords: well-being, social norms, working hours
    JEL: J22 I31 D62
    Date: 2015–04
  7. By: Albert Park (Department of Economics, Hong Kong University of Science and Technology; Institute for Emerging Market Studies, Hong Kong University of Science and Technology); Shu Cai (Department of Economics, Hong Kong University of Science and Technology)
    Abstract: We provide a new explanation for the stronger relationship between income and subjective wellbeing (SWB) found in cross-sectional versus panel studies based on the predictions of a rational expectations model of utility maximization with permanent and transitory income shocks. The model predicts that SWB is affected by unanticipated rather than anticipated income, and is more influenced by permanent rather than transitory income shocks. We hypothesize that share of cross-sectional income variation accounted for by permanent income is greater than the share of changes in income over time accounted for by unanticipated shocks to permanent income. We test our predictions using a unique panel dataset from rural China which includes subjective expectations of future income and actual income in each wave, enabling us to separately identify the effects of unanticipated permanent and transitory income shocks. The results confirm the predictions, providing support for the importance of permanent income in explaining SWB.
    Keywords: subjective well-being, permanent income, transitory income
    JEL: O12 I31
    Date: 2015–02
  8. By: Caliendo, Marco (University of Potsdam); Gielen, Anne C. (Erasmus University Rotterdam); Mahlstedt, Robert (IZA)
    Abstract: Although home-ownership has been shown to restrict geographic labor mobility and to affect job search behavior of unemployed, there is no evidence so far on how it affects their future re-employment outcomes. We use two waves of detailed German survey data of newly unemployed individuals to study the effect of home-ownership on the job search behavior of unemployed and their re-employment outcomes. We show that unemployed who own a home are less willing to move and also less likely to apply for jobs for which one would have to move. However, we do not find any evidence for compensations of their restricted mobility by more intensive (more search channels or applications) or different (more active or informal) search behavior. Furthermore, we find that home-ownership does not seem to harm the employment prospects of the unemployed. Although the re-employment probability in the short-run is slightly lower, we find that after one year home-owning unemployed have found better re-employment jobs, in terms of wages and job satisfaction, than their renting counterparts.
    Keywords: job search behavior, home-ownership, search effort, reservation wage, unemployment duration
    JEL: J64 J61
    Date: 2015–04

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