nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2011‒10‒15
four papers chosen by
Maximo Rossi
University of the Republic

  1. THE EFFECTS OF PEOPLES’ HEIGHT AND RELATIVE HEIGHT ON WELL-BEING By Vincenzo Carrieri; Maria De Paola
  2. The French Unhappiness Puzzle: the Cultural Dimension of Happiness By Claudia Senik
  3. Income Inequality and Health: Lessons from a Residential Assignment Program By Hans Grönqvist; Per Johansson; Susan Niknami
  4. Double-Sided Moral Hazard in Job Displacement Insurance Contracts By Parsons, Donald O.

  1. By: Vincenzo Carrieri; Maria De Paola (Dipartimento di Economia e Statistica, Università della Calabria)
    Abstract: Using a rich Italian survey, we investigate the effect of height on individual happiness. From our analysis it emerges that a large part of the effect of height on well-being is driven by a positive correlation between height and economic and health conditions. However, for young males the effect of height on happiness persists even after controlling for these variables, implying that height may produce some psycho-social direct effects on well-being. Consistent with this hypothesis, we find that males care not only about their own height but also about the height of people in their reference group. Well-being is greater for individuals who are taller than other subjects in their reference group. Results are robust to different definitions of reference group and controlling for a number of other reference group characteristics. We speculate that the beneficial effect of height on young males' well-being may be related to the fact that in some countries, such as Italy, and especially for men, height is considered as a proxy for handsomeness.
    Keywords: height, social comparison, subjective well-being
    JEL: D6 I10 I30
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:clb:wpaper:201110&r=ltv
  2. By: Claudia Senik (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, Université Paris-Sorbonne - Ministère de l'Education nationale, de l'Enseignement supérieur et de la Recherche)
    Abstract: This article sheds light on the important differences in self-declared happiness across countries of equivalent affluence. It hinges on the different happiness statements of natives and immigrants in a set of European countries to disentangle the influence of objective circumstances versus psychological and cultural factors. The latter turns out to be of non-negligible importance in explaining international heterogeneity in happiness. In some countries, such as France, they are mainly responsible for the country's unobserved idiosyncratic level of (un-)happiness.
    Keywords: Happiness ; Subjective Well-Being ; International Comparisons ; France ; Immigration ; European Social Survey
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00628837&r=ltv
  3. By: Hans Grönqvist (SOFI, Stockholm University); Per Johansson (IFAU; Uppsala University; IZA); Susan Niknami (SOFI, Stockholm University)
    Abstract: This paper investigates how income inequality affects health. Although a large literature has shown that inhabitants in areas with greater income inequality suffer from worse health, past studies are severely plagued by inadequate data, non-random residential sorting and reverse causality. We address these problems using longitudinal population hospitalization data coupled with a settlement policy where Swedish authorities distributed newly arrived refugee immigrants to their initial area of residence. The policy was implemented in a way that provides a source of plausibly random variation in initial location. Our empirical analysis reveals no statistically significant effect of income inequality on the probability of being hospitalized. This finding holds also when investigating subgroups more vulnerable to negative health influences and when studying different types of diseases. There is however some indications of a detrimental effect on older persons’ health; but the magnitude of the effect is small. Our estimates are precise enough to rule out large effects of income inequality on health.
    Keywords: Income inequality; Immigration; Quasi-experiment
    JEL: I10 J15
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:nor:wpaper:2011017&r=ltv
  4. By: Parsons, Donald O. (George Washington University)
    Abstract: Job displacement insurance typically includes both unemployment benefits and lump-sum severance pay, and each has provoked policy concerns. Unemployment insurance concerns have centered on distorted job search/offer acceptance decisions by the worker, severance-induced firing cost concerns on excessive labor hoarding by firms. A single period private contracting model is used to investigate the interaction of these two seemingly distinct issues. Viewed singly, familiar results emerge. The absence of separation benefits of any kind leads to excessive labor hoarding as a primitive form of earnings insurance. In a limited information environment, the distribution of job displacement insurance between the two benefit types becomes important. Unemployment insurance benefits must be limited (relative to first-best levels) and severance pay made more generous. Firing cost considerations are less familiar. Because the firm wants to provide benefits, they cannot be "contracted around." Although formally driven by the sum of (unsubsidized) severance pay and expected unemployment benefits, the second-best firing cost program limits severance pay only. Together the two constraints create an unpromising contracting environment. The firing cost constraint is the more easily relaxed by government action – subsidies of sufficient size to one or another of the separation programs will work. Offer acceptance requires restrictions on leisure (workfare). Unfortunately, if first-best benefits are mandated, efficiency requires that both be eased.
    Keywords: job displacement, unemployment insurance, severance pay, moral hazard, firing costs
    JEL: J65 J41 J33 J08
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp6003&r=ltv

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