nep-hap New Economics Papers
on Economics of Happiness
Issue of 2019‒11‒04
seven papers chosen by

  1. Do Entrepreneurs Have High Life Satisfaction? Evidence from Japan By HONJO Yuji; IKEUCHI Kenta; NAKAMURA Hiroki
  2. Types of Institutions and Well-Being of Self-Employed and Paid Employees in Europe By Michael Fritsch; Alina Sornger; Michael Wyrwich
  3. Right to Happiness – A Challenge for International Organizations and Governments By Titus Corlatean
  4. A Happy Choice: Wellbeing as the Goal of Government By Andrew E. Clark; Paul Frijters; Christian Krekel; Richard Layard
  5. Relative Deprivation in Tanzania By Jean-Marc Bédhat Atsebi; Ada Ferrer-i-Carbonell
  6. In brief...The long-term effects of financial distress in childhood By Marta Barazzetta; Andrew Clark; Conchita D'Ambrosio
  7. Technological Availability and Employees' Well-being: A Pathway to Responsible Digitization By Schneider, Katharina Ruth

  1. By: HONJO Yuji; IKEUCHI Kenta; NAKAMURA Hiroki
    Abstract: This study investigates the impact of entrepreneurial experience on life satisfaction. Using a unique survey about entrepreneurial experience, level of wealth, and personal attributes of individuals in Japan, we examine the factors that mediate the association between entrepreneurial experience and subjective well-being. As a result, we do not find any evidence on the total effect of entrepreneurial experience on subjective well-being. However, we find a positive indirect effect of entrepreneurial experience on subjective well-being through wealth, in addition to a negative indirect effect through debt. Our findings suggest that monetary incentives motivate Japanese individuals to become entrepreneurs.
    Date: 2019–10
  2. By: Michael Fritsch (Friedrich Schiller University Jena, and Halle Institute for Economic Research (IWH), Germany); Alina Sornger (John Cabot University Rome, Italy, and Kiel Institute for the World Economy (IfW), and Institute of Labor Economics (IZA Bonn), Germany); Michael Wyrwich (University of Groningen, The Netherlands)
    Abstract: This paper analyzes the role of different types of institutions, such as entre- preneurship-facilitating entry conditions, labor market regulations, quality of government, and perception of corruption for individual well-being among self-employed and paid employed individuals. Well-being is operationalized by job and life satisfaction of individuals in 32 European countries measured by data from EU Statistics on Income and Living Conditions (EU-SILC). We find that institutions never affected both occupational groups in opposite ways. Our findings indicate that labor market institutions do not play an im- portant role well-being. The results suggest that fostering an entrepreneurial society in Europe is a welfare enhancing strategy that benefits both, the self- employed and paid employees.
    Keywords: Entrepreneurship, institutions, well-being, life satisfaction, job satisfaction
    JEL: L26 I31 D01 D91 P51
    Date: 2019–05–02
  3. By: Titus Corlatean (Dimitrie Cantemir Christian University, Bucharest, Romania)
    Abstract: Through all his life, the humans seek happiness. Across the world, people aspire to live happily without fear to something or someone, and in harmony with God or with nature. In a world shaken by economic crisis, natural disasters or armed conflicts, life has shown that to be truly happy, in addition to material wealth, people also need spiritual wellbeing. We need a new paradigm of sustainable development. Economic wellbeing, social and a healthy environment together define the concept of happiness on a global scale. This might be implemented through a generic index named the gross global happiness index. UN, OECD, EC bodies and governments of some countries have understood that only economic indicators are not enough to develop public policies able to find solutions to the problems of the contemporary world. Economic data should be complemented with information designed to measure quality of life not only in material terms. The international community should promote sustainable development capable of ensuring every opportunity to seek happiness. The debates on the subject, held at international level could result, among other things, that the right to happiness should be recognized legally binding. There are already proposals for inclusion in the Charter of Fundamental Rights of the European Union. This paper is a call for continued efforts made by the governments of some countries and several international bodies towards the elaboration of public policies able to lead to sustainable development and improving the quality of life.
    Keywords: right to happiness, prosperity, human rights, sustainable development, public policy, GDP, economic growth, international community, the United Nations
    Date: 2019–08
  4. By: Andrew E. Clark; Paul Frijters; Christian Krekel; Richard Layard
    Abstract: In this article, we lay out the basic case for wellbeing as the goal of government. We briefly review the history of this idea, which goes back to the ancient Greeks and was the acknowledged ideal of the Enlightenment. We then discuss possible measures on which a wellbeing orientation could be based, emphasising the importance of acknowledging the political agency of citizens and thus their own evaluations of their life. We then turn to practicalities and consequences: how would one actually set up wellbeing-oriented decision-making and what difference should we expect from current practice? We end by discussing the current barriers to the adoption of wellbeing as the goal of government, both in terms of what we need to know more about and where the ideological barriers lay.
    Keywords: subjective wellbeing, life satisfaction, public policy, political economy, social welfare
    JEL: D60 D70 H11 I31
    Date: 2019–10
  5. By: Jean-Marc Bédhat Atsebi; Ada Ferrer-i-Carbonell
    Abstract: This paper examines the importance of relative deprivation in Tanzania, a poor African country, using three waves of the Tanzanian National Panel Survey. We contribute to earlier literature in Africa by controlling for time persistent unobservable individual characteristics (panel data) and by using two measures of satisfaction (life and financial satisfaction) and two definitions of reference group. By comparing results between satisfaction measures and across definitions of reference groups we help to understand the mechanisms through which comparisons work in a poor setting. In contrast with earlier literature, we find strong evidence of relative deprivation in financial satisfaction of all individuals in Tanzania, and evidence for life satisfaction only for individuals with weaker ties with their community. For those with strong ties (47% of our total sample; 54% of the rural sample), we find evidence of a positive correlation between life satisfaction and the average consumption of close neighbors and argue that this can be explained by feelings of empathy. In the paper we present several tests. We argue in favor of taking comparisons to others seriously when assessing and introducing welfare policies, also in less developed countries.
    Keywords: Africa, financial satisfaction, life satisfaction, relative deprivation, reference income
    JEL: D63 D64 I32 O12
    Date: 2019–10
  6. By: Marta Barazzetta; Andrew Clark; Conchita D'Ambrosio
    Abstract: Is there a relationship between childhood circumstances and outcomes later in life? Andrew Clark and colleagues consider the cognitive and non-cognitive consequences for young adults whose families experienced major financial problems when they were children.
    Keywords: income, financial problems, child outcomes, subjective well-being, behaviour, education, alspac
    JEL: I31 I32 D60
    Date: 2019–11
  7. By: Schneider, Katharina Ruth
    Abstract: Today, technologies, particularly information and communication technologies (ICTs), such as smartphones and laptops, are ubiquitous in people’s everyday working and private lives leading to fundamental changes. ICTs facilitate an availability for private and work-related contacts without any temporal or spatial constraints. This dissertation addresses on the one hand risks and potential detrimental effects on individual’s well-being that may arise through ICT use and have gained considerable attention in research and practice. On the other hand and foremost, responsible ICT-based solutions with regard to both availability and well-being-related physiological measures are provided that emphasize the opportunities and potential improving effects of ICTs. Thereby, the dissertation takes a pathway to responsible digitization by focusing on the individual user perceived as a human agency. The overarching aim of the dissertation is to provide responsible ICT-based solutions for the assessment of employees’ well-being, in particular regarding availability and physiological measures. To reach this overarching aim, two comprehensive empirical studies are conducted. In particular, the ICT-based Availability Management Study is aimed to shed light on employees’ individual aligned availability by considering their perceptions, motives, and preferences. Therefore, results of a qualitative (n = 59) and quantitative study (n = 589) indicate that the availability preference vary depending on the life domain, the current context, and type and priority of contacts. Hence, requirements and design elements for a responsible ICT-based solution that enables the user to align the actual availability with individual availability preferences are derived. Following principles of the design science research approach, the Availability-Monitor and Availability-Manager as two smartphone applications are developed as the ICT-based solution. The applications are evaluated regarding employees’ stress and work-life balance in a five-week field study with 31 participants using the applications and a control group (n = 55). The evaluation results show that participants using the applications report a significant increase in work-life balance and significant decrease in stress. Hence, ICTs could constitute a feasible solution enabling individuals to align their actual availability and, thereby, supporting their well-being. Study 2 addresses the application of well-being-related physiological measures recorded with ICTs, particularly wearables, for organizational research. Thereby, an in-depth understanding of the opportunities but also pitfalls that arises with the application, in particular regarding methodological properties of the measures and potential measurement issues, are provided. Furthermore, two guidelines for both processing and analyzing wearable-measured physiological measures accounting for the properties and issues and the validation of wearable-measured physiological data are given. The guidelines serve as a rigorous standard of designing studies that record, process, and analyze wearable-measured physiological data. The guidelines are exemplified with real data of an experimental comparison study with 32 participants using the Trier Social Stress Test as the experimental procedure. In this study, physiological stress measures (i.e., heart rate, heart rate variability) recorded with two wearables (i.e., wristband, breast strap) and an established stationary device are compared for validation. The results indicate that the compared wearables offer potential to record cardiovascular data and replace the stationary device. Thus, wearables could serve as an ICT-based solution to assess individuals’ well-being validly and reliably. Together, the dissertation contributes to research and practice by firstly examining responsible ICT-based solutions for the assessment of individuals’ well-being. In particular, both empirical studies indicate the potential ICTs may provide to assess, regulate, and finally improve employees’ well-being. Second, the methodological insights of both studies extend the methodological toolbox of organizational scholars, specifically with regard to developing and evaluating smartphone applications and applying physiological measures for research purposes. In sum, valuable methodological foundations for future research in the emerging area of ecological momentary assessment are provided that enable such studies to create a comprehensive understanding of the individual’s behavior and momentary emotional states, which reflect individuals’ well-being. With illuminating the potential of responsible ICT-based solutions for individuals’ well-being and, therefore, a pathway to responsible digitization, this thesis goes beyond previous research and practice that only shed light either on the detrimental or beneficial site of the double-edged sword ICTs are referred to. Thus, valuable new insights are gained that provide implications for employees as human agencies, employers and organizations, and further research considering ICTs as threefold, the research purpose, the solution, and psychophysiological measurement device in order to improve employees’ well-being.
    Date: 2019

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