nep-hap New Economics Papers
on Economics of Happiness
Issue of 2017‒12‒03
seven papers chosen by
Viviana Di Giovinazzo
Università degli Studi di Milano-Bicocca

  1. Adaptation and Loss Aversion in the Relationship between GDP and Subjective Well-being By Hovi Matti; Laamanen Jani-Petri
  2. Education gradient in well-being late in life: the case of China By Agar Brugiavini; Danilo Cavapozzi; Yao Pan
  3. RELATIVE INCOME AND HAPPINESS By Nisachon Leerattanakorn
  4. Joint hypothesis tests for multidimensional inequality indices By Abul Naga, Ramses H.; Shen, Yajie; Yoo, Hong Il
  5. Can having internal locus of control insure against negative shocks? Psychological evidence from panel data By Buddelmeyer, Hielke; Powdthavee, Nattavudh
  6. Happiness at work By De Neve, Jan-Emmanuel; Ward, George
  7. Early-Life Correlates of Later-Life Well-Being: Evidence from the Wisconsin Longitudinal Study By Andrew E. Clark; Tom Lee

  1. By: Hovi Matti; Laamanen Jani-Petri (Faculty of Management, University of Tampere)
    Abstract: We examine the roles of adaptation and loss aversion in the relationship between national income and subjective well-being. Earlier studies have found that people and nations tend to adapt to changes in income, and that well-being is more sensitive to income losses than to income gains. We apply a model which allows for both adaptation and asymmetries to cross-country panel data. We find evidence for both short-run and long-run loss aversion. Asymmetry becomes more important over time because the effects of income increases become statistically insignificant, whereas the effects of income decreases are significant and large also in the long run.
    Keywords: Subjective well-being, Life satisfaction, Happiness, Adaptation, Loss aversion, Output, Income, GDP, Economic growth, Macroeconomics, Easterlin paradox
    JEL: O11 I31
    Date: 2017–11
  2. By: Agar Brugiavini (Department of Economics, University Of Venice Cà Foscari); Danilo Cavapozzi (Department of Economics, University Of Venice Cà Foscari; Netspar); Yao Pan (Department of Economics, University Of Venice Cà Foscari)
    Abstract: We draw data from the China Health and Retirement Longitudinal Study(CHARLS)to investigate the education gradient in the current well-being of a representative sample of the Chinese population aged 45 or over. We analyse how the education gradient combines with the marked differences in the social policies implemented in rural and urban China.
    Keywords: Education, multidimensional well-being index, rural and urban China
    JEL: J14 I31 I24
    Date: 2017
  3. By: Nisachon Leerattanakorn (Maejo University)
    Abstract: Most of the literature confirms link between relative real income and happiness, but few research study the link of income perception. This empirical study aims to investigate the linkage between relative income and happiness. We conducted a survey and then estimated happiness using the ordered logit model. Results showed that individual happiness is not only related to absolute relative income, but is also associated with the attitude toward relative income in two dimensions, namely, individual?s needs and compared with those of other people. Moreover, self-esteem, trust, and community specification factors can influence individual happiness. Policy implication should concern real inequality together with perception on inequality.
    Keywords: Happiness, Well-being, Relative income, Attitude, Thailand
    JEL: A12 D01 I31
    Date: 2017–10
  4. By: Abul Naga, Ramses H.; Shen, Yajie; Yoo, Hong Il
    Abstract: An inequality index over p dimensions of well-being is decomposable by attributes if it can expressed as a function of p unidimensional inequality indices and a measure of association between the various dimensions of well-being. We exploit this decomposition framework to derive joint hypothesis tests regarding the sources of multidimensional inequality, and present Monte Carlo evidence on their finite sample behavior.
    Keywords: Multidimensional inequality indices; Large sample distributions; Joint hypothesis tests; Bootstrap
    JEL: J1
    Date: 2016–02–27
  5. By: Buddelmeyer, Hielke; Powdthavee, Nattavudh
    Abstract: We investigate whether the intensity of emotional pain following a negative shock is different across the distribution of a person's locus of control – the extent to which individuals believe that their actions can influence future outcomes. Using panel data from Australia, we show that individuals with strong internal locus of control are psychologically insured against own and others’ serious illness or injury, close family member detained in jail, becoming a victim of property crime and death of a close friend, but not against the majority of other life events. The buffering effects vary across gender. Our findings thus add to the existing literature on the benefits of internal locus of control.
    Keywords: locus of control; resilience; well-being; happiness; HILDA
    JEL: I19
    Date: 2015–12–24
  6. By: De Neve, Jan-Emmanuel; Ward, George
    Abstract: Happiness is typically defined by how people experience and evaluate their lives as a whole. Since the majority of people spend much of their lives at work, it is critically important to gain a solid understanding of the role that employment and the workplace play in shaping happiness for individuals and communities around the world. In this paper, we focus largely on the role of work and employment in shaping people’s happiness, and investigate how employment status, job type, and workplace characteristics relate to measures of subjective wellbeing
    Keywords: subjective wellbeing; employment; job type; job characteristics
    JEL: R14 J01
    Date: 2017–03
  7. By: Andrew E. Clark; Tom Lee
    Abstract: We here use data from the Wisconsin Longitudinal Study (WLS) to provide one of the first analyses of the distal (early-life) and proximal (later-life) correlates of older-life subjective well-being. Unusually, we have two distinct measures of the latter: happiness and eudaimonia. Even after controlling for proximal covariates, outcomes at age 18 (IQ score, parental income and parental education) remain good predictors of well-being over 50 years later. In terms of the proximal covariates, mental health and social participation are the strongest predictors of both measures of well-being in older age. However, there are notable differences in the other correlates of happiness and eudaimonia. As such, well-being policy will depend to an extent on which measure is preferred.
    Keywords: life-course, well-being, eudaimonia, health, happiness
    JEL: I31 I38
    Date: 2017–11

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