TY - UNPB
T1 - Income and happiness across Europe: do reference values matter
AU - Caporale, G.M.
AU - Georgellis, Y.
AU - Tsitsianis, N.
AU - Yin, Y.P.
PY - 2006
Y1 - 2006
N2 - Using data from the European Social Survey (ESS), we examine the link between income and subjective well-being. We find that, for the whole sample of nineteen European countries, although income is positively correlated with both happiness and life satisfaction, reference income exerts a negative effect on individual wellbeing. Thus our results lend support to both the absolute and relative income hypotheses. Performing separate analyses for some Eastern European countries, we also find some evidence of a tunnel effect , in that reference income has a positive--impact on subjective well-being. Our findings support the view that in environments with stable income and employment, reference income serves as a basis for social comparisons, whereas in relatively volatile environments, it is used as a source of information for forming expectations about future status.
AB - Using data from the European Social Survey (ESS), we examine the link between income and subjective well-being. We find that, for the whole sample of nineteen European countries, although income is positively correlated with both happiness and life satisfaction, reference income exerts a negative effect on individual wellbeing. Thus our results lend support to both the absolute and relative income hypotheses. Performing separate analyses for some Eastern European countries, we also find some evidence of a tunnel effect , in that reference income has a positive--impact on subjective well-being. Our findings support the view that in environments with stable income and employment, reference income serves as a basis for social comparisons, whereas in relatively volatile environments, it is used as a source of information for forming expectations about future status.
M3 - Working paper
T3 - Business School Working Papers
BT - Income and happiness across Europe: do reference values matter
PB - University of Hertfordshire
ER -