nep-hap New Economics Papers
on Economics of Happiness
Issue of 2016‒02‒12
five papers chosen by
Viviana Di Giovinazzo
Università degli Studi di Milano-Bicocca

  1. Psychological Costs of Currency Transition: Evidence from Euro Adoption By Otrachshenko, Vladimir; Popova, Olga; Tavares, José
  3. Market Competition and Efficient Cooperation By Jordi Brandts; Arno Riedl
  4. Multidimensional Poverty in Seychelles By Christophe Muller; Asha Kannan; Roland Alcindor
  5. Education through the lens of sustainable human development By Gianna Alessandra Sanchez Moretti

  1. By: Otrachshenko, Vladimir; Popova, Olga; Tavares, José
    Abstract: We analyze individual levels of life satisfaction in Slovakia, after that country adopted the Euro, following a spirited debate. We gauge the psychological cost of transition to the new currency by comparing individual life satisfaction, not only before and after Euro introduction, but by comparison with individuals with similar characteristics in the neighboring Czech Republic, which did not adopt the Euro. Both countries were economically and politically integrated for decades, and share similar macroeconomic indicators just before the currency change in Slovakia. We find evidence of substantial psychological costs of currency transition, which are especially important for the old, the unemployed, those with low education and in households with children. We believe these results suggest the importance of information and enlightened debate before a sweeping change in economic context such as the adoption of a new currency.
    Keywords: currency transition; Czech Republic; euro; Slovakia; subjective well-being
    JEL: E52 F55 I31
    Date: 2016–01
  2. By: Sugata Bag, Suman Seth and Anish Gupta (Centre for Development Economics, Delhi School of Economics, University of Delhi, India)
    Abstract: Urban population in India has been rising rapidly as millions of migrants are moving to urban areas aspiring for higher earning and better living. The number of urban poor is also growing and a significant number of these poor find spaces in slums and continue to struggle for better living standards. Improving their conditions call for significant efforts from the governments for better policy designs. However, better policy design requires understanding the commonalities and differences across slums within and between cities. In this paper, we conduct a comparative study of representative slums across three largest metro cities in India through primary surveys. We find certain characteristics, such as large average household size, poor housing quality, low female labour market participation and high school enrolment rates among children, to be common across and within three cities. Our study however reveals crucial differences between the cities in the demographic pattern of migration and its temporal element. And that in turn brings out considerable heterogeneity among different groups within slums of each cities with respect to living standards, access to civic amenities like sanitation facilities and drinking water. Moreover, there exists major cross-city differences in adult literacy rates across gender, consumption pattern, and subjective wellbeing. Overall, we find that slums in Mumbai on average perform much better in various living condition and social indicators than slums in Delhi and Kolkata.
    Date: 2016–02
  3. By: Jordi Brandts; Arno Riedl
    Abstract: We use laboratory experiments to study the causal effects of favorable and unfavorable competitive market experience on cooperation in a subsequent social dilemma game. The issues we study are part of the broader topic of whether there are behavioral spillovers between different spheres of social interactions. Market interaction takes place in a continuous double auction market in which one side of the market obtains the larger part of the surplus. We examine the efficiency of subsequent cooperation for pairs of market-winners, market-losers and mixed pairs and study both the cases where interaction in the social dilemma is with others from the same market, 'market-partners', and where it is with others from another market, 'market-strangers', and compare it with benchmark behavior in a stand-alone social dilemma game. We find that in market-partners, market experience has adverse effects on the efficiently of cooperation on both market-winner and market-loser pairs. In market-strangers, pairs of market-winners manage to cooperate more efficiently. These results indicate that it is not market experience per se that lowers the ability to cooperate. Rather, having competed for scarce resources on the same side of the market makes it difficult to overcome the social dilemma and positive market experience fosters cooperation only for those who did not have to compete with each other. We also show that differences in cooperation cannot be explained by ex-ante income differences and find that market experience also affects subjective well-being and social value orientation.
    Keywords: competition, cooperation, experiments
    JEL: A13 C92 D30 J50 M50
    Date: 2015–12
  4. By: Christophe Muller (AMSE - Aix-Marseille School of Economics - EHESS - École des hautes études en sciences sociales - Centre national de la recherche scientifique (CNRS) - Ecole Centrale Marseille (ECM) - AMU - Aix-Marseille Université); Asha Kannan (UNDP - United Nations Development Programme); Roland Alcindor (UNDP - United Nations Development Programme)
    Abstract: The typically used multidimensional poverty indicators in the literature do not appear to be relevant for middle-income countries like Seychelles and can yield unrealistic estimates of poverty. In particular, the deprivations typically considered in such measures little occurs in middle-income economies. In this paper, we propose a new approach to measuring multidimensional poverty in Seychelles based on a mix of objective and subjective information about households living conditions, and on how these households view their spending priorities. The empirical results based on our new approach show that a small but non-negligible minority of Seychellois can be considered as multidimensionally poor, mostly as not being able to satisfy their shelter and food basic needs. Finally, the Seychelles social aid programs run by the Agency for Social Protection is poorly targeted whether evaluated in terms of multidimensional poverty or in terms of one-dimensional monetary poverty.
    Keywords: poverty,multidimensional wellbeing,destitution,Seychelles
    Date: 2016–01
  5. By: Gianna Alessandra Sanchez Moretti (IPC-IG)
    Abstract: "If human development is defined as a comprehensive economic, social, cultural and political process aiming to improve the well-being of populations and individuals, then the one element that can serve as the motor driving development is education. However, it is alleged that the international community and governments worldwide do not yet recognise the full potential and transformative power of education as a catalyst for human development, even if education is indeed considered a fundamental human right."(?)
    Keywords: education, sustainable human development
    Date: 2016–02

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