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on Economics of Happiness |
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Issue of 2021‒06‒28
seven papers chosen by |
| By: | Badunenko, Oleg; Cordero, Jose M.; Kumbhakar, Subal C. |
| Abstract: | This paper contributes to the literature on subjective well-being of individuals by estimating a “happiness frontier” under the premise that individuals seek to maximize happiness. The happiness frontier is defined as the pinnacle of happiness, given the resources and personal characteristics of individuals. However, individuals may not only strive to maximize their happiness but also to achieve higher levels of income, ceteris paribus. Thus, there is a trade-off between these two objectives, and the happiness�income frontier is attained when one can neither increase her happiness nor income, given her resources and personal characteristics. If one fails to attain the happiness-income frontier, there is a shortfall. The shortfall measures the rate at which both happiness and income for an individual, who has failed to attain the happiness frontier, could be increased given everything else. We also explore the determinants of this shortfall and conduct an empirical analysis using micro-level data gathered from the World Values Survey (WVS) for 74 countries. Our results suggest that age as well as certain personal circumstances, such as being unemployed or having a partner, have a strong influence on the levels the estimated well-being and income attainment measures. Likewise, we also find that the quality of the government of the country of residence also greatly affects individuals’ capacity to convert their resources into higher levels of happiness and income. |
| Keywords: | Happiness (well-being), Income, Frontier, Happiness shortfall, Cross-country analysis |
| JEL: | C5 I3 |
| Date: | 2021–06–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:108316&r= |
| By: | Dolan, Paul (London School of Economics); Krekel, Christian (London School of Economics); Shreedhar, Ganga (London School of Economics); Lee, Helen (National Health Service); Marshall, Claire (National Health Service); Smith, Allison (Royal Voluntary Service) |
| Abstract: | There is a strong suggestion from the existing literature that volunteering improves the wellbeing of those who give up their time to help others, but much of it is correlational and not causal. In this paper, we estimate the wellbeing benefits from volunteering for England's National Health Service (NHS) Volunteer Responders programme, which was set up in response to the Covid-19 pandemic. Using a sample of over 9,000 volunteers, we exploit the oversubscription of the programme and the random assignment of volunteering tasks to estimate causal wellbeing returns, across multiple counterfactuals. We find that active volunteers report significantly higher life satisfaction, feelings of worthwhileness, social connectedness, and belonging to their local communities. A social welfare analysis shows that the benefits of the programme were at least 140 times greater than its costs. Our findings advance our understanding of the ways in which pro-social behaviours can improve personal wellbeing as well as social welfare. |
| Keywords: | subjective wellbeing, volunteering, pro-social action, quasi-natural experiment, social welfare analysis, COVID-19 |
| JEL: | I31 I38 D61 D64 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14431&r= |
| By: | Krekel, Christian (London School of Economics); De Neve, Jan-Emmanuel (University of Oxford); Fancourt, Daisy (University College London); Layard, Richard (London School of Economics) |
| Abstract: | Despite a wealth of research on its correlates, relatively little is known about how to effectively raise wellbeing in local communities by means of intervention. Can we teach people to live happier lives, cost-effectively and at scale? We conducted a randomised controlled trial of a scalable social-psychological intervention rooted in self-determination theory and aimed at raising the wellbeing and pro-sociality of the general adult population. The manualised course ("Exploring What Matters") is run by non-expert volunteers (laypeople) in their local communities and to date has been conducted in more than 26 countries around the world. We found that it has strong, positive causal effects on participants' subjective wellbeing and pro-sociality (compassion and social trust) while lowering measures of mental ill health. The impacts of the course are sustained for at least two months post-treatment. We compare treatment to other wellbeing interventions and discuss limitations and implications for intervention design, as well as implications for the use of wellbeing as an outcome for public policy more generally. |
| Keywords: | wellbeing, pro-social behaviour, communities, intervention, RCT |
| JEL: | C93 I12 I31 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14447&r= |
| By: | Bartolini, Stefano; Sarracino, Francesco |
| Abstract: | Empirical evidence suggests that achieving sustainability requires reducing economic growth, not just greening it. This conclusion often leads to ecological pessimism, based on two beliefs. The first is that there is a human tendency to unlimited expansion; the second is that lack of consensus makes limiting growth politically unfeasible. We challenge both beliefs. The decline of fertility and per-capita income growth provide reasons to expect decreasing human pressure on ecosystems. Moreover, the lack of a clear alternative to growth as a means to increase well-being creates the widespread perception of a trade-off between sustainability and current well-being. This hinders the consensus to the policy of limits to growth. Drawing on a large literature on happiness, social capital and other topics, we argue that policies for social capital can decouple well-being from economic growth. Indeed, the crisis of social capital experienced by much of the world's population is at the origin of the current unsustainable growth of the world economy. Declining social capital leads the economies to excessive growth, because people seek economic affluence to compensate for the emotional distress and collective disempowerment caused by poor social capital. We then suggest policies that, by promoting social capital, would expand well-being, and shift the economy to a more sustainable path characterized by slower economic growth. Such set of proposals is more politically viable than the current agenda of limits to growth and reconcile sustainability and well-being. |
| Keywords: | sustainability; social relations; subjective well-being; economic growth. |
| JEL: | I31 J1 O1 Q56 |
| Date: | 2021–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:108309&r= |
| By: | Fink Simonsen, Nicolai (University of Southern Denmark, DaCHE - Danish Centre for Health Economics); Kjær, Trine (University of Southern Denmark, DaCHE - Danish Centre for Health Economics) |
| Abstract: | It is standard practice in the literature to assume that an individual’s marginal utility of consumption is independent of health status. If this assumption is not met, it could have important implications for welfare economic analyses. The aim of this paper is to provide new, more comprehensive empirical evidence of state dependence following the approach used by Finkelstein et al. (2013). We use a rich combination of longitudinal survey data and administrative register data. Survey data were obtained from the Survey of Health, Ageing and Retirement in Europe (SHARE) and combined with data from the comprehensive Danish registers, including individual income data and data on health care utilisation based on the universal ICD-10 classification system. Utility is measured in terms of subjective well-being attained from the SHARE survey. To further increase the power of our sample, we used a state-of-the-art prediction algorithm to enrich the register data with information on subjective well-being. With this approach, this paper also makes a general methodological contribution on the use of prediction models for data enrichment and imputation. We define a reduced form equation in which individual subjective well-being is regressed according to income and health with an interaction effect capturing state dependence. Our results show evidence of negative state dependence. From our baseline regression, the estimated magnitude suggests that marginal utility of consumption decreases by 14.6% when an individual becomes sick. The results are robust to different levels of risk aversion and to assumptions regarding the mapping of the latent utility onto observed utility. |
| Keywords: | utility; health risk; consumption |
| JEL: | C53 D12 I10 J14 |
| Date: | 2021–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sduhec:2021_002&r= |
| By: | Anirban Mukhopadhyay (Chair Professor, Department of Marketing, Hong Kong University of Science and Technology Technology.Author-Email: anirban.mukhopadhyay@ust.hk); Amy Daton (Associate Professor, Department of Marketing, Hong Kong University of Science and Technology Technology.Author-Email: amy.dalton@ust.hk); Jingshi (Joyce) Liu (Associate Professor, Department of Marketing, City University of London Technology.Author-Email: jingshi.liu@city.ac.uk) |
| Abstract: | Use of social media is rapidly growing in emerging markets, yet relatively little is known about how the contents people post on social media affect their happiness. We find that posting photos of one's favorite possessions, under hashtags such as #Favoritethings or #Favoriteshirt, leads to greater happiness than posting photos of one's cumulative possessions or the baseline happiness level. This effect occurs because reminders of favorite possessions tend to reduce unfavorable social comparisons, which is otherwise prominent on social media. While social media users often post their material possessions on social media, they do not have the "right" intuitions about the type of possession-related content they should post to make themselves happier. Happier users tend to like the social media platform better. Thus, promoting trends for #favoritethings and similar hashtags can create a win-win situation, which benefit both the wellbeing of social media users and that of marketers and social media platforms. |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:hku:briefs:202153&r= |
| By: | Echeverría, Lucía (University of Zaragoza); Gimenez-Nadal, J. Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza) |
| Abstract: | Recent years have witnessed efforts worldwide to promote green mobility, aimed at boosting sustainable economic growth. However, how green mobility relates to travelers' well-being remains an open question. We explore whether "green" modes of transportation (public transit and walking/cycling) are associated with higher levels of well-being in comparison to private driving, placing special focus on different types of travel (related to paid work, unpaid work, personal care, childcare, and leisure). We use the UK Time Use Survey (UKTUS) from 2014-2015, and exploit information on self-reported enjoyment during travel, as a measure of experienced well-being. We estimate Ordinary Least Squares and Random Effects regressions for each travel category, and find relative, positive effects of physical transport on enjoyment, in terms of personal care and leisure, while the relative negative effects of public transport are observed for childcare and work/paid travel, in relationship to traditional driving modes. Our evidence suggests a need to develop strategies to effectively promote mobility by physical modes, while improving the experience of public transit users. |
| Keywords: | subjective well-being, green travelling, walking/cycling, public transport |
| JEL: | R4 J22 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14430&r= |