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on History and Philosophy of Economics |
| By: | Andrew J. Oswald (University of Warwick and IZA Bonn); Nattavudh Powdthavee (University of London) |
| Abstract: | Economics ignores the possibility of hedonic adaptation (the idea that people bounce back from utility shocks). This paper argues that economists are wrong to do so. It provides longitudinal evidence that individuals who become disabled go on to exhibit recovery in mental wellbeing. Adaptation to severe disability, however, is shown to be incomplete. The paper suggests ways to calculate the level of compensatory damages for the pain and suffering from disablement. Courts all over the world currently use ad hoc methods. |
| Keywords: | disability, adaptation, happiness, legal compensation, wellbeing, GHQ scores |
| JEL: | D1 I3 I31 K0 |
| Date: | 2006–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2208&r=hpe |
| By: | Eric M. Uslaner (University of Maryland) |
| Abstract: | Some researchers claim that diverse populations lead to less trust. Generalized trust is a core value that leads to positive outcomes in societies--from greater tolerance of minority groups and immigrants and willingness to do good deeds, to less corruption, more social welfare and education spending, more open markets, and better functioning government. Generalized trust fundamentally rests upon a foundation of respect for diversity, but at the same time arguing that societies have a common culture. It is the idea that people have a shared fate. Generalized trust rests upon a foundation of economic equality. Yet some claim that diversity leads to less trust rather than more trust. Trusting people who are different from yourself is atypical of most people, they claim. I dispute this--arguing that generalized trust is largely unrelated to population diversity. It is not diversity that matters--it is how populations are distributed. I show that trust is lower not in diverse societies, but rather in societies with large minority groups that are segregated from the majority groups. Minority residential segregation leads to less trust because it leads to less interaction across different groups in society--and leads minorities to associate only with each other, to form their own political organizations, and to see their fate as less dependent upon majority groups. I then discuss how economic inequality and the rule of law shape the relationship between trust and minority residential segregation. |
| Keywords: | Trust, Diversity, Corruption |
| JEL: | Z13 O57 D73 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2006.69&r=hpe |
| By: | Ono, Hiroshi (European Institute of Japanese Studies); Lee, Kristen Schultz (Penn State University) |
| Abstract: | This paper examines the relationship between specialization and happiness in marriage in the U.S. and Japan. Our findings, based on the General Social Surveys in the U.S. and Japan, indicate both similarities and differences in the determinants of marital happiness in the two countries. In the U.S., the findings are mixed. Women in the U.S. are more likely to embrace the bargaining model where their happiness is determined by their own income. Men in the U.S. are more likely to support the specialization model; they are happier if their wives are not working or, alternatively, if they are financially dependent on their wives. In Japan, we find support for the specialization model, particularly in the case of women; they are happier if they are specialized in the household and they have a higher household income. Our research highlights how marital quality is affected by the institutional context and the normative environment. |
| Keywords: | gender; family; marital happiness; specialization; bargaining |
| JEL: | D13 J12 J16 |
| Date: | 2006–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hastef:0631&r=hpe |