| Abstract: |
This paper applies the German Socio-Economic Panel to analyse the effect of
within household income comparison on individual life satisfaction. Our
estimates indicate, a primary breadwinner wife decreases spousal individual
happiness by roughly nine per cent. To state the economic significance, a
€70,000 increase in external, peer reference income corresponds to a similar
individual happiness decrease. The estimates suggest envy effects among
couples and provide mixed evidence for gender roles to influence subjective
well-being. Based on subsample estimations, our results are driven by younger
birth year quartiles, lower education and total income households, East German
couples and households with greater fulltime employment share. The paper adds
to within household interdependence of subjective well-being and indicates
negative consequences of couple income comparison for individual happiness.
Wives (barely) outearning their husbands seem to signal ’competition’. |