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The relative income hypothesis: A comparison of methods

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  • Brown, Sarah
  • Gray, Daniel
  • Roberts, Jennifer

Abstract

Studies of the relative income hypothesis find positive and negative effects of relative income. To facilitate comparisons we use a large household panel and highlight the sensitivity of the relative income effect to the definition of the reference group and to the estimation strategy employed.

Suggested Citation

  • Brown, Sarah & Gray, Daniel & Roberts, Jennifer, 2015. "The relative income hypothesis: A comparison of methods," Economics Letters, Elsevier, vol. 130(C), pages 47-50.
    • Handle: RePEc:eee:ecolet:v:130:y:2015:i:c:p:47-50
    DOI: 10.1016/j.econlet.2015.02.031
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    1. We don't want economic growth
      by chris in Stumbling and Mumbling on 2020-01-26 13:40:47

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    4. Thomas Dufhues & Judith Möllers & Antje Jantsch & Gertrud Buchenrieder & Laura Camfield, 2023. "Don’t Look Up! Individual Income Comparisons and Subjective Well-Being of Students in Thailand," Journal of Happiness Studies, Springer, vol. 24(2), pages 477-503, February.
    5. Zubrickas, Robertas, 2023. "The relative income effect and labor supply," Journal of Economic Behavior & Organization, Elsevier, vol. 209(C), pages 176-184.
    6. Eiji Yamamura, 2021. "Where do I rank? Am I happy?: learning income position and subjective-wellbeing in an internet experiment," Papers 2107.11185, arXiv.org.
    7. Zhijian Zhang & Xueyuan Wang, 2021. "Ambition or Jealousy? It Depends on Whom you are Compared with," Journal of Happiness Studies, Springer, vol. 22(3), pages 1189-1215, March.
    8. Xiangdan Piao & Xinxin Ma & Tetsuya Tsurumi & Shunsuke Managi, 2022. "Social Capital, Negative Event, Life Satisfaction and Sustainable Community: Evidence from 37 Countries," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 17(3), pages 1311-1330, June.
    9. Muna Shifa & Murray Leibbrandt, 2018. "Relative Economic Position and Subjective Well-Being in a Poor Society: Does Relative Position Indicator Matter?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 139(2), pages 611-630, September.
    10. HAURET Laetitia & WILLIAMS Donald R., 2018. "Time-in-Labour-Market and the Reference Group," LISER Working Paper Series 2018-02, Luxembourg Institute of Socio-Economic Research (LISER).
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    More about this item

    Keywords

    Relative income; Reference group; Subjective well-being;
    All these keywords.

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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