nep-hap New Economics Papers
on Economics of Happiness
Issue of 2018‒07‒30
nine papers chosen by
Viviana Di Giovinazzo
Università degli Studi di Milano-Bicocca

  1. Inequalities in Life Expectancy and the Global Welfare Convergence By Hippolyte D'Albis; Florian Bonnet
  2. Childhood Circumstances and Young Adulthood Outcomes: The Effects of Mothers' Financial Problems By Marta Barazzetta; Andrew E. Clark; Conchita D'Ambrosio
  3. What Women Want (their men to do): Housework and satisfaction in Australian households By Foster, Gigi; Stratton, Leslie S.
  4. Persistence of suicides in G20 countries: SPSM approach to three generations of unit root tests By Anyikwa, Izunna; Hamman, Nicolene; Phiri, Andrew
  5. Pay Level Comparisons in Job Satisfaction Research and Mainstream Economic Methodology By Stavros, Drakopoulos
  6. Always Online: Boundary Management and Well-being of Knowledge Workers in the Age of Information and Communication Technology Use By Reinke, Kathrin
  7. Life satisfaction, QALYs, and the monetary value of health By Huang, Li; Frijters, Paul; Dalziel, Kim; Clarke, Philip
  8. What matters the most to people?: Evidence from the OECD Better Life Index users’ responses By Carlotta Balestra; Romina Boarini; Elena Tosetto
  9. Assessing well-being in European regions. Does government quality matter? By Jesús Peiró-Palomino; Andrés J. Picazo-Tadeo

  1. By: Hippolyte D'Albis (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Florian Bonnet (UP1 UFR02 - Université Panthéon-Sorbonne - UFR d'Économie - UP1 - Université Panthéon-Sorbonne, PSE - Paris School of Economics)
    Abstract: Becker, Philipson and Soares (2005) maintain that including life expectancy gains in a welfare indicator result in a reduction of inequality between 1960 and 2000 twice as great as when measured by per capita income. We discuss their methodology and show it determines the convergence result. We use an alternative methodology, based on Fleurbaey and Gaulier (2009), which monetizes differences in life expectancy between countries at each date rather than life expectancy gains. We show that including life expectancy has no effect on the evolution of world inequality.
    Keywords: World inequality,Well-being indicators,Life expectancy
    Date: 2018–01
  2. By: Marta Barazzetta ( - Université du Luxembourg); Andrew E. Clark (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Conchita D'Ambrosio ( - Université du Luxembourg)
    Abstract: We here consider the cognitive and non-cognitive consequences on young adults of growing up with a mother who reported experiencing major financial problems. We use data from the Avon Longitudinal Study of Parents and Children to show that early childhood financial problems are associated with worse adolescent cognitive and non-cognitive outcomes, controlling for both income and a set of standard variables. The estimated effect of financial problems is almost always larger in size than that of income. Around one quarter to one half of the effect of financial problems on the non-cognitive outcomes seems to transit through mother's mental health.
    Keywords: Behaviour,ALSPAC,Education,Income,Poverty,Subjective well-being
    Date: 2017–10
  3. By: Foster, Gigi; Stratton, Leslie S.
    Abstract: The time allocated to household chores is substantial, with the burden falling disproportionately upon women. Further, social norms about how much housework men and women should contribute are likely to influence couples’ housework allocation decisions and satisfaction. Using Australian data spanning the years 2001-2014, we employ a two-stage estimation procedure to examine how deviations from housework norms relate to couples’ satisfaction. We find that satisfaction is negatively affected by predicted housework time, and that women’s satisfaction, but not men’s, is robustly affected by their partners’ residual housework time. When he exceeds housework norms, she is happier with housework allocations, but less happy in broader dimensions. We suggest several reasons for our results, including that housework is more salient in women’s lives than in men’s, that housework in general is not a preferred activity, and that some degree of gender-norm conformity in regard to housework can positively affect women’s life satisfaction.
    Keywords: Satisfaction,Social Norms,Housework
    JEL: D13 I31 Z13
    Date: 2018
  4. By: Anyikwa, Izunna; Hamman, Nicolene; Phiri, Andrew
    Abstract: Suicides represent an encompassing measure of psychological well-being, emotional stability as well as life satisfaction and have been recently identified by the World Health Organization (WHO) as a major global health concern. The G20 countries represent the powerhouse of global economic governance and hence possess the ability to influence the direction of global suicide rates. In applying the sequential panel selection method (SPSM) to three generations of unit root testing procedures, the study investigates whether G20 countries should be concerned with possible persistence within suicide rates. The results obtained from all three generation of tests provide rigid evidence of persistence within the suicides for most member states of the G20 countries hence supporting the current strategic agenda pushed by the WHO in reducing suicides to a target rate of 10 percent. In addition, we further propose that such strategies should emulate from within G20 countries and spread globally thereafter.
    Keywords: Suicides; sequential panel selection method (SPSM); nonlinear unit root tests; Fourier form unit root tests; G20 countries
    JEL: C22 C32 C51 C52 I12
    Date: 2018–07–07
  5. By: Stavros, Drakopoulos
    Abstract: Although social scientists have been investigating the nature and impact of job satisfaction for many decades, economists only started to investigate job satisfaction systematically in the late 1980’s. Almost from the first systematic studies of job satisfaction by economists, the research potential of the notion of pay level comparisons was realized. The idea of pay level comparisons in job satisfaction has proven particularly useful also because it has important implications for a number of standard theoretical and economic policy results. However, the inclusion of the variable of comparison wage in job satisfaction and the resulting supporting empirical findings, are in sharp contrast to the orthodox approach, given that in mainstream economic theory an individuals’ utility is assumed to be a function of absolute income only. Despite the important theoretical and policy implications, mainstream economic theory has not paid much heed to the job satisfaction conceptual formulations and empirical findings. The paper argues that there are methodological reasons for this state of affairs which seem to be linked to the subjective well-being research in general, and to the job satisfaction literature in particular. A strong mistrust against the method of stated preferences and the inherent methodological bias against the integration of psychological findings, are suggested as the two prime reasons. Although a few prominent figures in job satisfaction research have realized the mainstream methodological attitude, it is necessary that job satisfaction specialists should consider more seriously the basic components of mainstream economic methodology that relate to their research field.
    Keywords: job satisfaction; pay level comparisons; wages; economic methodology
    JEL: B41 I31 J28 J30
    Date: 2018–07–03
  6. By: Reinke, Kathrin
    Abstract: Information and communication technologies (ICTs) transform individuals’ ways of working and living fundamentally. This dissertation addresses two pivotal developments coming along with the increasing prevalence of ICTs that significantly influence individuals’ well-being: First, ICTs change human communication – at work and in their personal life as well as across the boundaries of these life domains. Second, in the age of cross-border availability ICTs have the power to alter how individuals manage the boundaries of their work and personal life. Preceding research on these topics suggests that ICTs are a double-edged sword: They bring benefits as well as harm for individuals’ well-being. As well-being is an important precursor of performance-related outcomes, organizations face new challenges in the light of these developments to maintain and foster their employees’ well-being. Hence, this thesis is concerned with the overarching question how potentially positive consequences coming along with the ubiquity of ICTs can be fostered and negative consequences can be avoided to maintain and increase individual well-being in the long run. To provide new insights on this question, two comprehensive empirical studies are conducted. Specifically, study 1 examines under which circumstances ICT-mediated communication has beneficial or detrimental effects on well-being from an event-based perspective, applying a mixed-methods research design. Based on an exploratory qualitative study with 50 knowledge workers, four features of ICT-mediated communication events are identified that determine users’ momentary affective states: valence, disturbance, need for action, and synchronicity. Then, in a quantitative experience sampling method study with data on 2,537 events and 1,355 daily measures, these features’ episodic effects on momentary affective states and their spillover effects on end-of-day well-being are tested. Hierarchical linear modeling results show that the four features exert episodic effects on momentary affective states. Analyses of spillover effects further suggest that the effects of valence, disturbance, and need for action on momentary affective states cumulate over the course of a day to affect individuals’ end-of-day well-being. Study 2 focuses on antecedents and effects of individuals’ boundary management of both their work and personal life in the age of cross-border availability. Results of structural equation modeling with data from 401 knowledge workers collected in two waves show that coworker availability expectations diminish work-life segmentation, while personal contact availability expectations reduce life-work segmentation. The study also shows that boundary management behavior has asymmetrical effects, depending on directionality: Work-life segmentation is associated with increased well-being, while life-work segmentation is associated with reduced well-being. Further, the relationship between work-life segmentation and well-being is moderated by individuals’ work-life segmentation preferences, underlining the relevance of boundary management preferences to our understanding of the conditions under which given boundary management behaviors are beneficial or detrimental to well-being. In sum, these comprehensive studies provide a more nuanced picture of the determinants that may influence when the consequences coming along with the ubiquity of ICTs are positive or negative for individuals’ well-being, thereby yielding several important contributions for research: Study 1 contributes to our understanding of the drivers of ICT-mediated communication’s double-edged nature as well as their dynamic relationship with well-being from an event-based perspective by identifying four affectively significant features of ICT-mediated communication events and unveiling both their episodic and spillover effects on individual well-being. Study 2 contributes to a comprehensive framework for investigating and understanding bidirectional boundary management in the age of cross-border availability by detecting distinct antecedents of work-life and life-work segmentation and their opposing effects on well-being. Together, their findings suggest three major factors which may determine when the consequences of the ubiquity of ICTs are beneficial or detrimental for individuals’ well-being – event-specific features, personal preferences, and life domain concerned. With these new insights based on theoretical underpinning, this dissertation contributes to a more differentiated empirical and theoretical understanding of individuals’ boundary management and well-being in the age of ICT use. Thereby, the thesis suggests valuable implications for future research and further provides employees as well as organizations with differentiated leverages to establish an environment in which ICTs are used in both healthy and productive ways.
    Date: 2018
  7. By: Huang, Li; Frijters, Paul; Dalziel, Kim; Clarke, Philip
    Abstract: The monetary value of a quality-adjusted life-year (QALY) is frequently used to assess the benefits of health interventions and inform funding decisions. However, there is little consensus on methods for the estimation of this monetary value. In this study, we use life satisfaction as an indicator of ‘experienced utility’, and estimate the dollar equivalent value of a QALY using a fixed effect model with instrumental variable estimators. Using a nationally-representative longitudinal survey including 28,347 individuals followed during 2002–2015 in Australia, we estimate that individual's willingness to pay for one QALY is approximately A$42,000-A$67,000, and the willingness to pay for not having a long-term condition approximately A$2000 per year. As the estimates are derived using population-level data and a wellbeing measurement of life satisfaction, the approach has the advantage of being socially inclusive and recognizes the significant meaning of people's subjective valuations of health. The method could be particularly useful for nations where QALY thresholds are not yet validated or established.
    Keywords: Australia; Wellbeing; Life satisfaction; QALY; Value of health
    JEL: J1
    Date: 2018–08
  8. By: Carlotta Balestra (OECD); Romina Boarini (OECD); Elena Tosetto (OECD)
    Abstract: The OECD Better Life Index is an interactive composite index that aggregates average measures of country’s well-being outcomes through weights defined by users. This paper studies these weights by analysing the responses given by close to 130 000 users since 2011 to date. The paper has three goals. First, to investigate the factors shaping users’ preferences over a set of 11 well-being dimensions. Second, to provide insights into users’ preferences for a large group of countries which differ in terms of culture and living conditions. Third, to test for the effects of users’ satisfaction with respect to a given well-being dimension on the weight they attach to it, across different population groups. Various empirical models are used to identify responses’ patterns and see whether they can be accounted for by respondents’ characteristics and their perceived well-being. The paper finds that health status, education and life satisfaction are the aspects that matter the most for BLI users in OECD countries. Men assign more importance to income than women, while women value community and work-life balance more than men. Health, safety, housing and civic engagement become more important with age, while life satisfaction, work-life balance, jobs, income and community are particularly important for youth. There are also clear regional patterns in the choices by BLI users; for instance education, jobs and civic engagement are particularly important in South America while personal safety and work-life balance matter a lot in Asia-Pacific. Analysis carried out on a subset of observations (i.e. BLI-users who completed an extended questionnaire) finds that, for several well-being dimensions (i.e. jobs, housing, community, health, education, civic engagement, personal safety, life satisfaction and work-life balance), there is a positive and linear relationship between individual preferences and self-reported satisfaction in the same dimension, with evidence of distinctly different patterns of association within the population in the case of income and education.
    Keywords: Better Life Index, composite index, preferences, users, well-being
    JEL: C43 I31 O1
    Date: 2018–07–24
  9. By: Jesús Peiró-Palomino (Economics Department, Universitat Jaume I, Castellón, Spain); Andrés J. Picazo-Tadeo (Department of Applied Economics II, University of Valencia, Spain)
    Abstract: This paper contributes a composite indicator of well-being for 168 European regions built with data from 10 well-being domains provided by the OECD Regional Well- being Dataset. Regions are then ranked according to their respective levels of well-being. Furthermore, the role of the quality of regional governments in explaining well-being dis- parities is assessed using data from the Quality of Government EU Regional Dataset. Results reveal notable well-being differences across European regions, especially between core and periphery ones, with the former enjoying higher well-being. In addition, government quali- ty is found to boost regional well-being, although uneven impacts are found for core and periphery regions.
    Keywords: Composite well-being indicators; European regions; government quality
    JEL: C14 C61 I31 H41 R50
    Date: 2018

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