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on Unemployment, Inequality and Poverty |
| By: | Alberto Prati; Claudia Senik |
| Abstract: | We revisit the famous Easterlin paradox by considering that life evaluation scales refer to a changing context, hence they are regularly reinterpreted. We propose a simple model of rescaling based on both retrospective and current life evaluations, and apply it to unexploited archival data from the USA. When correcting for rescaling, we find that the well-being of Americans has substantially increased, on par with GDP, health, education, and liberal democracy, from the 1950s to the early 2000s. Using several datasets, we shed light on other happiness puzzles, including the apparent stability of life evaluations during COVID-19, why Ukrainians report similar levels of life satisfaction today as before the war, and the absence of parental happiness. |
| Keywords: | happiness, life satisfaction, subjective well-Being, Easterlin Paradox, Cantril Ladder, rescaling, Gallup, SOEP |
| Date: | 2025–01–20 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2068 |
| By: | Arellano-Bover, Jaime (Yale University); Bianchi, Nicola (Northwestern University); Lattanzio, Salvatore (Bank of Italy); Paradisi, Matteo (Einaudi Institute for Economics and Finance) |
| Abstract: | This paper studies the interaction between the decrease in the gender pay gap and the stagnation in the careers of younger workers, analyzing data from the United States, Italy, Canada, and the United Kingdom. Our findings highlight the importance of labor-market entry to understand the shrinking of the gender pay gap. The entire decline in the aggregate pay gap originates from (i) newer worker cohorts who enter the labor market with smaller-than-average gender pay gaps and (ii) older worker cohorts who exit with higher-than-average gender pay gaps. Convergence at labor-market entry originates primarily from younger men's positional losses in firms' hierarchies and the overall pay distribution. We propose an explanation by which a larger supply of older workers can crowd out younger workers from a limited number of top-paying positions. These negative career spillovers disproportionately affect the career trajectories of younger men because they were more likely than younger women to hold higher-paying jobs at baseline. Consistent with this aging-driven crowd-out interpretation, younger men experience the largest positional losses within the hierarchies of firms that are more exposed to workforce aging. These findings hold after controlling for alternative explanations for the progressive closure of the gender pay gap at labor-market entry. Finally, we document that labor-market exit has been the sole contributor to the decline in the gender pay gap after the mid-1990s, indicating that without structural breaks, the closure of the gender pay gap is unlikely in the foreseeable future. |
| Keywords: | gender gap, workforce aging, cohort turnover, wage growth, labor-market entry, entry wages, initial conditions, age pay gap |
| JEL: | J16 J31 J11 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17621 |
| By: | David G. Blanchflower; Alex Bryson |
| Abstract: | We report on the wellbeing of the young in 31 Ex-Soviet Republics located in Eastern Europe and Central Asia. We find no evidence of the decline in the mental health of the young relative to older people which characterizes Western Europe and English-speaking advanced economies. The mental health of the young in ex-Soviet republics is stable relative to older people across various surveys including the Gallup World Poll, the Eurobarometers, the World Values Surveys and the European Social Survey, as well as in surveys from the European Bank of Reconstruction and Development and UNICEF. However, there are two exceptions. A 2023 Flash Eurobarometer Mental Health survey conducted by the European Commission shows unhappiness declines in age in every EU member country including 11 in Eastern Europe. A similar finding emerges in our analysis of the web-based Global Minds surveys of 2020-2024 in 9 former Soviet republics. Youngster ages 18-24 in these surveys are especially unhappy. Furthermore, in keeping with research on children aged 15-16 in the PISA surveys in other countries, we find life satisfaction of these school children in ex-Soviet Republics declined over the period 2015-2022 and that, among this group, time spent on digital devices was associated with lower happiness. |
| JEL: | I31 J13 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33356 |
| By: | Borooah, Vani |
| Abstract: | Happiness is usually measured by simply asking people about how happy they are (or, have been in the recent past). The most usual way of doing so is to ask a “happiness question”: ‘Taking all things together, would you say that you are (i) very happy; (ii) quite happy; (iii) not very happy; (iv) not at all happy?’ This subjective measure of happiness, based on a self-assessment of one’s emotional well-being, could, however, be complemented by other, more objective, measures of whether people were happy or unhappy. This chapter does so in respect of two indicators: tranquilliser usage among men and women in Belfast, Northern Ireland; and the propensity to self-harm among persons in the state of Queensland, Australia. |
| Keywords: | Happiness, Objective and Subjective Measures |
| JEL: | H0 I3 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123179 |
| By: | Tamim, Abdulrazzak (University of California, Berkeley); Smith, Emma (Georgetown University); Palmer, I. Bailey (University of California, Berkeley); Miguel, Edward (University of California, Berkeley); Leone, Samuel (University of California, Berkeley); Rozo, Sandra V. (World Bank); Stillman, Sarah (London School of Economics) |
| Abstract: | Refugees require assistance for basic needs like housing but local host communities may feel excluded from that assistance, potentially affecting community relations. This study experimentally evaluates the effect of a housing assistance program for Syrian refugees in Jordan on both the recipients and their neighbors. The program offered full rental subsidies and landlord incentives for housing improvements, but saw only moderate uptake, in part due to landlord reluctance. The program improved short-run housing quality and lowered housing expenditures, but did not yield sustained economic benefits, partly due to redistribution of aid. The program unexpectedly led to a deterioration in child socio-emotional well-being, and also strained relations between Jordanian neighbors and refugees. In all, housing subsidies had limited measurable benefits for refugee well-being while worsening social cohesion, highlighting the possible need for alternative forms of aid. |
| Keywords: | refugees, housing, forced migration, social integration |
| JEL: | D22 J61 O17 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17622 |
| By: | Borooah, Vani |
| Abstract: | The link between income and happiness is often explained by the Easterlin paradox: income and happiness in a country are positively related at a point in time but unrelated, over time. So, at any point in time, money did buy happiness but, over time, the level of happiness in a country did not rise by much as it grew richer. This paradox was explained by the fact that higher income conferred two benefits to individuals: consumption benefits (in the sense of being able to afford more, and better, goods and services) and status benefits (in the sense of enjoying superior status relative to one’s peers). But what is not clear is the identity of comparator group for the purpose of deriving status benefits. This chapter uses a novel set of data to define parents as the comparator group and defines the status a person derives from their income in relation their parents’ income. Another issue in the amount of happiness that one can extract from income concerns the circumstances in which it is earned. Given that paid employment is central to the lives of many individuals, and that many persons spend a substantial part of their lives in paid employment, an understanding of people’s feelings of well-being in the workplace or, equivalently, their levels of “job satisfaction”, is of paramount importance to public policy. This chapter examines the strength of a variety of factors in determining the intensity of job satisfaction in 33 countries. The empirical foundation for the study is provided by data for nearly 22, 000 employed respondents, pertaining to the year 2000, obtained from the World Values Survey. |
| Keywords: | Income, Job Satisfaction, Inter-Generational |
| JEL: | I3 J3 J31 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123250 |
| By: | Costa, Dora L. (UCLA); Bygren, Lars Olov (Karolinska Institutet); Graf, Benedikt (NBER); Karlsson, Martin (University of Duisburg-Essen); Price, Joseph (Brigham Young University) |
| Abstract: | Explanations for the West's escape from premature mortality have focused on chronic malnutrition or income and on public health or state capacity. We argue that by ignoring the multigenerational effects of variance in ancestors' harvests, we are underestimating the contribution of modern economic growth to the escape from early death at older ages. Using a newly constructed multigenerational dataset for Sweden, we show that grandsons' longevity was strongly linked to spatial shocks in paternal grandfathers' yearly harvest variability when agricultural productivity was low and market integration was limited. We reason that an epigenetic mechanism is the most plausible explanation for our findings. We posit that the removal of trade barriers, improvements in transportation, and agricultural innovation reduced harvest variability. We contend that for older Swedish men (but not women) born 1830-1909 this reduction was as important as decreasing contemporaneous infectious disease rates and more important than eliminating exposure to poor harvests in-utero. |
| Keywords: | intergenerational transmission, longevity, ecomomic growth, harvest variability |
| JEL: | I15 J11 N33 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17620 |
| By: | Borooah, Vani |
| Abstract: | The twin issues of what makes people “happy, ” and the relative strength of these happiness affecting factors, have in the recent past become a staple of economic analysis and goes under the rubric of “happiness research”. The aim of such research is to understand what the determinants of happiness are and how these vary across population groups, distinguished by a variety of socio-economic and demographic factors (for example, education, marital status, economic position, social class, and geographic location). A key component of this research is a person’s subjective assessment of their state of happiness and this assessment is sought to be correlated, using methods of multiple regression, with the multitude of factors hypothesised to affect it. The purpose of this chapter is to use data from the World Values Survey to provide a self-contained overview of this research, discussing the many variables that are conventionally included in the “happiness equation”, the justification for their inclusion, and the strength of their effect. |
| Keywords: | Determinants of Happiness |
| JEL: | H0 I0 I00 I2 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123174 |
| By: | Pierre-André Chiappori; Monica Costa Dias; Costas Meghir; Hanzhe Zhang |
| Abstract: | Positive assortative matching refers to the tendency of individuals with similar characteristics to form partnerships. Measuring the extent to which assortative matching differs between two economies is challenging when the marginal distributions of the characteristic along which sorting takes place (e.g., education) change for either or both sexes. We show how the use of different measures can generate different conclusions. We provide axiomatic characterization for measures such as the odds ratio, normalized trace, and likelihood ratio, and provide a structural economic interpretation of the odds ratio. We then use our approach to consider how marital sorting by education changed between the 1950s and the 1970s cohort, for which both educational attainment and returns in the labor market changed substantially. |
| JEL: | C78 D1 J1 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33354 |
| By: | Borooah, Vani |
| Abstract: | This chapter provides an overview of the main themes presented in this book. Most books on happiness are concerned with answering, in their diverse ways, a basic question: how should I live? Such books assume, however, that the path to happiness lies entirely within one’s control. Happiness is simply a matter of doing certain things and refraining from doing certain other things. This book, however, takes a different view. It is that happiness is not always within our control but, instead, prey to the attitudes and actions of others. Following Jean-Paul Sartre’s aphorism, “hell is other people”, the broad theme of this book is that “unhappiness is other people”. In the language of economics, “other” people, through their attitudes and actions, create externalities – generally negative - which serve to make “us” unhappy. The instruments for creating such externalities are intolerance and feelings of envy/superiority. This book expands on this theme in respect of three areas: religion, money, and prejudice. |
| Keywords: | Survey, Happiness, Issues in Welfare |
| JEL: | H0 I00 I3 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123175 |