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What Do You Think Would Make You Happier? What Do You Think You Would Choose?

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Author Info

  • Daniel J. Benjamin
  • Ori Heffetz
  • Miles S. Kimball
  • Alex Rees-Jones

Abstract

Would people choose what they think would maximize their subjective well-being (SWB)? We present survey respondents with hypothetical scenarios and elicit both choice and predicted SWB rankings of two alternatives. While choice and predicted SWB rankings usually coincide in our data, we find systematic reversals. We identify factors--such as predicted sense of purpose, control over one's life, family happiness, and social status--that help explain hypothetical choice controlling for predicted SWB. We explore how our findings vary by SWB measure and by scenario. Our results have implications regarding the use of SWB survey questions as a proxy for utility. (JEL D03, I31)

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.102.5.2083
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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 102 (2012)
Issue (Month): 5 (August)
Pages: 2083-2110

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Handle: RePEc:aea:aecrev:v:102:y:2012:i:5:p:2083-2110

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References

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  1. Loewenstein, George & O'Donoghue, Ted & Rabin, Matthew, 2000. "Projection Bias in Predicting Future Utility," Department of Economics, Working Paper Series qt5qh6142m, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
  2. Laibson, David I., 1997. "Golden Eggs and Hyperbolic Discounting," Scholarly Articles 4481499, Harvard University Department of Economics.
  3. Finkelstein, Amy & Luttmer, Erzo F. P. & Notowidigdo, Matthew J., 2008. "What Good Is Wealth without Health? The Effect of Health on the Marginal Utility of Consumption," Working Paper Series rwp08-036, Harvard University, John F. Kennedy School of Government.
  4. Easterlin, Richard A., 1995. "Will raising the incomes of all increase the happiness of all?," Journal of Economic Behavior & Organization, Elsevier, vol. 27(1), pages 35-47, June.
  5. Bruno Frey & Simon Luechinger & Alois Stutzer, 2009. "The life satisfaction approach to valuing public goods: The case of terrorism," Public Choice, Springer, vol. 138(3), pages 317-345, March.
  6. Stevenson, Betsey & Wolfers, Justin, 2009. "The Paradox of Declining Female Happiness," IZA Discussion Papers 4200, Institute for the Study of Labor (IZA).
  7. Kahneman, Daniel & Wakker, Peter P & Sarin, Rakesh, 1997. "Back to Bentham? Explorations of Experienced Utility," The Quarterly Journal of Economics, MIT Press, vol. 112(2), pages 375-405, May.
  8. Erzo F. P. Luttmer, 2005. "Neighbors as Negatives: Relative Earnings and Well-Being," The Quarterly Journal of Economics, MIT Press, vol. 120(3), pages 963-1002, August.
  9. Luechinger, Simon & Raschky, Paul A., 2009. "Valuing flood disasters using the life satisfaction approach," Journal of Public Economics, Elsevier, vol. 93(3-4), pages 620-633, April.
  10. M. Fleurbaey., 2012. "Beyond GDP: The Quest for a Measure of Social Welfare," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 2.
  11. Di Tella, R. & MacCulloch, R.J.: Oswald, A.J., 1997. "The Macroeconomics of Happiness," Papers 19, Centre for Economic Performance & Institute of Economics.
  12. Loewenstein, George & Ubel, Peter A., 2008. "Hedonic adaptation and the role of decision and experience utility in public policy," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1795-1810, August.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Some links on eudaimonic well-being
    by Liam Delaney in Economics and Psychology Research on 2013-02-11 19:40:00
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Cited by:
  1. Santi Budria & Ada Ferrer-i-Carbonell, 2013. "Income Comparisons and Non-Cognitive Skills," Working Papers 733, Barcelona Graduate School of Economics.
  2. Wunder, Christoph & Heineck, Guido, 2012. "Working Time Preferences, Hours Mismatch and Well-Being of Couples: Are There Spillovers?," IZA Discussion Papers 6786, Institute for the Study of Labor (IZA).
  3. Daniel J. Benjamin & Ori Heffetz & Miles S. Kimball & Nichole Szembrot, 2013. "Aggregating Local Preferences to Guide Marginal Policy Adjustments," NBER Working Papers 18787, National Bureau of Economic Research, Inc.
  4. Chen, Natalie & Juvenal, Luciana, 2013. "Quality, Trade, and Exchange Rate Pass-Through," CAGE Online Working Paper Series 165, Competitive Advantage in the Global Economy (CAGE).
  5. Cheng, Terence C & Powdthavee, Nattavudh & Oswald, Andrew J, 2014. "Longitudinal Evidence for a Midlife Nadir in Human Wellbeing: Results from Four Data Sets," The Warwick Economics Research Paper Series (TWERPS) 1037, University of Warwick, Department of Economics.
  6. Lohmann, Steffen, 2013. "Information technologies and subjective well-being: Do material aspirations rise?," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79708, Verein für Socialpolitik / German Economic Association.
  7. Dorsett, Richard & Oswald, Andrew J., 2014. "Human well-being and in-work benefits: A randomized controlled trial," CAGE Online Working Paper Series 182, Competitive Advantage in the Global Economy (CAGE).
  8. Draca, Mirko, 2013. "Reagan’s Innovation Dividend? Technological Impacts of the 1980s US Defense Build-Up," CAGE Online Working Paper Series 168, Competitive Advantage in the Global Economy (CAGE).
  9. Filipe R. Campante & David H. Yanagizawa-Drott, 2013. "Does Religion Affect Economic Growth and Happiness? Evidence from Ramadan," NBER Working Papers 19768, National Bureau of Economic Research, Inc.
  10. Dorsett, Richard & Oswald, Andrew J., 2014. "Human Well-being and In-Work Benefits: A Randomized Controlled Trial," IZA Discussion Papers 7943, Institute for the Study of Labor (IZA).
  11. Daniel J. Benjamin & Ori Heffetz & Miles S. Kimball & Alex Rees-Jones, 2013. "Can Marginal Rates of Substitution Be Inferred from Happiness Data? Evidence from Residency Choices," NBER Working Papers 18927, National Bureau of Economic Research, Inc.
  12. Lohmann, Steffen, 2013. "Information technologies and subjective well-being: Does the internet raise material aspirations?," Center for European, Governance and Economic Development Research Discussion Papers 169, University of Goettingen, Department of Economics.
  13. Ghosal, Sayantan & Dalton, Patricio, 2013. "Characterizing Behavioral Decisions with Choice Data," CAGE Online Working Paper Series 107, Competitive Advantage in the Global Economy (CAGE).

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